As per the latest data provided by the National Payments Corporation of India (NPCI), PhonePe and Google Pay had market shares of 46 and 34 percent, respectively, in September, in terms of volumes of UPI transactions handled. Why does this matter: These two major UPI players continue to be above the 30 percent market share cap set by NPCI, which goes into effect starting January 2023. It's not clear if and how Google Pay and PhonePe will be able to comply with the cap given that their market share doesn't appear to be reducing. What is the 30 percent cap: NPCI announced the 30 percent cap on transaction volume in November 2020 and gave existing players two years, starting January 2021, to comply with the mandate in a phased manner. “In view of the recent growth in UPI transaction volumes, NPCI has analyzed the risks in the UPI ecosystem,” it said in its circular back then, adding that the market share cap has been introduced in order to “address the risks and protect the UPI ecosystem.” In March 2021, NPCI prescribed operational guidelines that detail how market share will be calculated and how apps will have to enforce the cap. Will there be an extension: In July, The Economic Times reported that NPCI may extend the deadline for its 30 percent mandate because making the market leaders scale back might lead to market disruption for consumers. However, there hasn't been any official extension yet. The government will not intervene: The Indian government said that it will not "actively…
