Paytm’s UPI credit line to ease short-term borrowing

• The digital credit line rides atop India’s UPI rail, meeting consumers on the platform they already use for day-to-day transactions.
• India is entering an era where UPI, BNPL, and digital wallets are merging into a seamless financial ecosystem.

Paytm’s leap into credit on the Unified Payments Interface (UPI) is quickly turning heads and could have a profound effect on how Indians access short-term borrowing.

Instead of relying on traditional credit cards, Paytm’s latest feature—”Paytm Postpaid”—lets users shop now and cover their expenses later, sparking new excitement around Buy Now, Pay Later (BNPL) functionality in one of the world’s busiest payment economies.

Launched in partnership with Suryoday Small Finance Bank in September 2025, “Paytm Postpaid” enables seamless spending with the simple promise: “Spend Now, Pay Next Month.” Cardless and frictionless, this digital credit line rides atop India’s UPI rail, meeting consumers on the platform they already use for day-to-day transactions.

It’s a key milestone for financial inclusion, especially in a country where credit card ownership remains modest by global standards yet smartphone adoption soars.

India: Payments powerhouse

According to GlobalData, UPI currently processes around 20 billion transactions a month, cementing India’s status as a global real-time payments powerhouse.

Ravi Sharma, Lead Banking and Payments Analyst at GlobalData, calls Paytm’s credit push on UPI a groundbreaking move, expanding liquidity options for consumers and upping the stakes for both banks and card issuers.

“By skipping legacy cards and offering short-term credit directly via UPI, Paytm is set to boost both competition and BNPL adoption, giving millions easier access to credit.”

The wider landscape is buzzing with innovation. For instance, transit-linked payments have taken a leap forward thanks to NPCI’s partnership with Chennai’s MTC, rolling out “RuPay On-The-Go,” a card that handles everything from metro rides to parking.

Meanwhile, digital wallets have gone mainstream, powered by a tech-forward, youthful population. Google Wallet’s India debut in May 2024 made it easier than ever to store documents and digital credentials on the go, supported by a wide range of local brands.

A unique group finance feature, “UPI Circle,” launched in August 2024, extends payment flexibility within families or closed groups by letting a primary user control delegated transactions—another stride toward broader payment access and inclusion.

Sharma said that India is entering an era where UPI, BNPL, and digital wallets are merging into a seamless financial ecosystem.

“The demand for flexible, embedded credit is rewriting playbooks across the industry, presenting opportunities and risks alike. As more firms race to offer convenience, regulatory vigilance remains vital to keep lending standards robust. Ultimately, the direction is clear—innovation, inclusion, and digital-first solutions will define India’s vibrant payments future.”