According to a report by Bank of Baroda, UPI has become the most popular way to make payments during the festive season, showing that people are spending more and that demand is rising again. Report says that digital payments through UPI reached a record high of ₹17.8 lakh crore up from ₹15.1 lakh crore last year. In September 2025, UPI transactions increased by 2.6% from the previous month, showing steady growth in digital payments.
Other trends observed:
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Debit card usage increased which means people were spending directly from their bank accounts. Payments through debit cards rose to ₹65,395 crore, compared to ₹27,566 crore in the same period last year. This marks a comeback for debit cards, which had seen lower usage earlier.
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Credit card usage was moderate which shows fewer people borrowed money to spend. This shows people preferred to spend using UPI or debit cards rather than credit.
Differences in average spending per transaction:
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Debit cards: ₹8,084 per transaction
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UPI: ₹1,052 per transaction
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Credit cards: ₹1,932 per transaction
This means people mostly use UPI for smaller or medium purchases, while debit cards are used for bigger payments.
Altogether, payments made through UPI, debit cards, and credit cards added up to ₹18.8 lakh crore, showing a healthy increase in retail spending. This shows a sign that consumer demand is picking up this quarter. This shows how digital payments are playing a big role in driving shopping and consumption, especially during major festivals like Dussehra and Diwali.