By Ashwin Manikandan
MUMBAI, Sept 1 (Reuters) – India is preparing a framework that would let AI agents make small digital payments without approval for every transaction, three sources familiar with the matter said, potentially making UPI one of the world’s largest networks with agentic payments.
While leading payment companies have launched such frameworks in the U.S., Europe, Singapore and Australia, a rollout on the popular Unified Payments Interface would also put India among the first countries to have a national infrastructure for agentic AI payments.
UPI, operated by the National Payments Corporation of India, is the world’s largest retail fast-payment system by transaction volume, according to a 2025 IMF report.
It processed 24.51 billion transactions worth 29.82 trillion Indian rupees ($314.21 billion) in August, with Google Pay and Walmart’s PhonePe accounting for around three-fourths of monthly transaction volumes.
The Unified Agent Protocol is likely to be unveiled next week at the Global Fintech Fest in Mumbai, the sources said, requesting anonymity as the details are private.
The NPCI did not immediately respond to Reuters queries seeking comment.
EARLY USE CASES
Low-value, frequent purchases such as groceries are likely to be among the first use cases, the first source said, adding that e-commerce platforms are well-placed to capture early demand.
NPCI expects use cases to eventually become more sophisticated, the source said. For example, AI agents could place orders based on sale offers and discounts and make investments based on specified instructions around price thresholds.
The protocol is expected to draw on two existing UPI mechanisms — UPI Circle, which lets a primary account holder delegate payment authority to a secondary user such as an AI agent, and Reserve Pay, which lets customers block funds for multiple debits.
Banks currently cap such blocks at 10,000 rupees ($105.44) for up to 90 days, though this limit and its validity may be revisited for agentic use, the sources added.
NPCI is expected to offer infrastructure for merchants to integrate directly, letting customers set rule-based instructions for AI agents on when and how much to pay, with built-in spending limits, audit trails and identity checks, the sources said.
They added that the NPCI plans to build in a liability framework, but did not provide details.
GLOBAL PUSH
Global card networks Mastercard and Visa are also separately building similar agentic capabilities for payments in India, mirroring a global push by these companies to secure AI-driven commerce.
Mastercard completed its first authenticated agentic transaction in New Delhi in June.
Earlier this year, fintech firm Pine Labs launched its own agentic protocol, P3P, letting AI agents complete UPI payments after a single upfront authorisation.
($1 = 94.9050 Indian rupees)
(Reporting by Ashwin Manikandan; Editing by Janane Venkatraman)
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