Why people don’t change their UPI apps even when they hate them

Remember that time in 2022 when India’s top digital payments companies Phonepe, Paytm*, and Bharatpe were in a no-holds-barred turf war? Looking back, it seemed like there was news almost every other day about some tiff between the three market leaders. In fact, former managing director of Bharatpe, Ashneer Grover, has spoken on record about “street fights” between companies’ employees over QR codes. 

A little more than two years later, there’s only calm. QR code scuffles are over. No one is beating each other up. 

Both the peer-to-merchant and peer-to-peer payments space have settled down into a tripartite peace. Phonepe, Google Pay, and Paytm—in order of market share—are the clear leaders. This raises some interesting questions: How many UPI apps do you have on your phone? And do you have a favourite one? We may have multiple, but only one of them is ever really used. No amount of cashbacks or fancy user experiences make people want to switch to something else. 

Is it brand loyalty that is preventing users from churning out of old platforms and into new ones? 

A former Paytm executive told The Ken recently, “There is zero brand loyalty for UPI payments apps…” 

Well then, what is happening?

*Paytm founder Vijay Shekhar Sharma is an investor in The Ken

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