Analysts said RuPay has recently gained momentum in the credit-card ecosystem due to the availability of credit cards on the Unified Payments Interface (UPI) platform. They said that currently RuPay’s share in the credit-card market is around 16 percent as against about 3 percent two years ago they added. UPI Link : The deciding factor In late 2022 the Reserve Bank of India (RBI) had given the approval to link RuPay credit-cards only to UPI. This has led to a structural shift towards UPI: credit-card spends routed through UPI are now around 40 per cent in volume terms up from about 10 per cent at the end of FY24. This enables card issuers and network operators to benefit from UPI’s wide merchant-reach and low friction especially at the small-merchant end where traditional credit cards have had lower acceptance said analysts. RuPay’s own wider merchant acceptance and more favourable merchant discount rate (MDR) structure for small merchants has also given it some legs-up they added. Bernstein Research noted that “if UPI linkage remains exclusive to RuPay it is poised to emerge as the dominant network in credit cards…” Credit cards gain traction among Small Merchants & QR Rails With over 50 million merchants accepting UPI but less than 10 million POS terminals accepting all credit cards this expansion of merchant-reach has gained momentum. RuPay-network credit-card transactions executed on UPI benefit from lower or zero MDR for small-value (under ₹2000) and small-merchant transactions. While volumes race upwards Revenue nuances persist Analysts observed that while volumes have surged the revenue dynamics were nuanced with much of the growth coming in small-ticket transactions. Average transaction sizes for UPI-linked credit-card spends are still sub ₹1000 and many of these transactions attract little or no MDR leading to lower revenue per transaction. Issuing banks such as SBI Cards & Payment Services Ltd. and newer digital players such as Paytm Payments Bank have an opportunity and a challenge: as acceptance grows it will mean a virtuous cycle of more cards being issued but monetisation will depend on how these issuers can work to raise average ticket size and merchant reach.   UPI is the new norm and will be the de facto wallet for Indian consumers to make payments (even online) or use as a payments-platform. In this context to move up the value-chain from volume payments-platform and network-operators will need to play in credit-offering rewards and acceptance. If RuPay can sustain its UPI exclusivity and successfully push higher-value spends it could come to change the competitive dynamics of credit-cards in India. In essence RuPay is no longer only a domestic alternative network: it is becoming hardwired into the very core of India’s digital payments ecosystem with UPI as the launch-pad