UPI tops 200B transactions yet cash in circulation jumps 11.4% in FY26
RBI's FY26 report flags a paradox: retail digital payments surged 26.9% by volume and UPI grew 30%, but currency in circulation still rose 11.4%. Welfare transfers, GST and tax cuts fuelling spending, and a gold/silver rally — nearly half of core inflation in H2 — are keeping cash in play alongside digital rails.
RBI's FY26 report shows UPI crossed 200 billion transactions and retail digital payments rose 26.9%, yet currency in circulation grew 11.4%, driven by welfare transfers, GST/tax cuts boosting spending, and rising gold prices.
Why this matters
UPI's volume dominance keeps expanding — now 85.5% of India's payment volume and heading to Cyprus in 2026 — yet RBI data shows cash demand rising in parallel, not collapsing as digital rails scale.
Retail-company signals steady at 1,380 over 90 days, reflecting sustained payments and consumption coverage.