In 2025, UPI crossed 20+ billion transactions a month.
Approximately 5% of these transactions are on UPI Autopay.
Be it an OTT subscription , a Saas Subscription or an SIP – UPI autopay is the customer’s go-to today.
This November, UPI mandate executions stood at a value of ₹ 808 million, nearly double of its value in the previous year. Sectors such as mutual fund investments, insurance, OTT subscriptions, telecom, gaming, and edtech depend heavily on mandates for predictable cash flow and seamless customer experience.
Yet despite this explosive growth, the mandate system had several constraints that limited its reliability and flexibility. Understanding these limitations is key to appreciating why NPCI introduced mandate interoperability – one of the most important updates to UPI AutoPay since its launch.
The Limitations of the Current System – and it’s impact on Businesses and Users
The system of mandates, before interoperability, was built on a static, non-portable architecture.
When a user created a UPI mandate on a UPI app, the mandate was bound to the PSP app ( gpay, phonepay etc ) on which the mandate was created and to the UPI handle of the user. This meant that the user could not view all the mandates they created at a single place nor could they port the mandate to a different app. The user remained dependent on that particular provider’s uptime and capabilities.
Similarly, for the merchant, once the mandate was created, it was locked to the exact Payee VPA ( merchant@hdfcbank, for example) used at creation. This meant that even when the merchant had the capability to use multiple routes to process a transaction – the system allowed routing only through the original Payee VPA. This made merchants dependent on a specific bank to execute a given mandate – lowering success rates. Even a short outage window would cause thousands of failed premiums or investment payments.
What’s Changing ?
NPCI is introducing mandate interoperability, which fundamentally changes how UPI mandates are created and executed. Two key updates enable this:
Merchant Identifier Code (MIC)
Mandates will no longer be validated against the Payee VPA used at creation. Instead, a new Merchant Identifier Code, generated based on the merchant’s PAN, will be used for mandate validation. This decouples the mandate from the original bank VPA and allows the mandate to be recognised independent of the acquiring bank used at setup.
Payer-Side Interoperability
Mandates will no longer be tied to the UPI app on which they were created. NPCI is introducing two new operations that allow users to view all mandates from any UPI app and also to move mandates from one app to another.
What does this mean for your Business ?
- Higher Success Rates
With interoperability, mandates are no longer tied to a single Payee VPA or bank. This allows merchants’ PSP partners like Cashfree to dynamically route mandate debits across multiple banks instead of relying on just one.
Now, with MIC-based validation, Cashfree can evaluate real-time bank performance, use fallback routes when one bank faces downtime, and intelligently select the healthiest path for each debit leading to significantly higher mandate success rates.
- Greater Reliability & Business Continuity
Dynamic Routing ensures business continuity even when one PSP or Bank faces downtime. For sectors like insurance or lending- where missed debits can lead to policy lapses or overdue EMIs , this resilience is critical.
- Better Customer Experience and Retention
More successful debits mean fewer interruptions, fewer service blocks, and fewer follow-ups with customers. For subscription, OTT, and SaaS platforms, this directly translates into lower churn and more predictable monthly revenues.
What does this mean for your Customer ?
- Better Visibility and Control
Customers can now view their mandates on any app of their choice removing friction of shifting between apps to monitor multiple mandates
- No Lock-ins
With interoperable mandates – customers are no longer locked into a single app. They can move mandates freely giving them full freedom of choice.
Recurring Payments You Can Count On – Cashfree Stack
Cashfree fully supports interoperable UPI mandates, enabling merchants to benefit from dynamic routing and a more resilient mandate infrastructure. With 91% success rates on mandate registration and execution, Cashfree helps businesses minimise failures, protect revenue, and deliver a seamless customer experience.
Beyond reliability, Cashfree offers a complete mandate suite tailored to diverse business models – from periodic mandates for subscriptions and SIPs, to on-demand mandates for flexible collections, non-revocable mandates to reduce defaults, and TPV-enabled mandates for added security.
Together, this makes Cashfree’s UPI Autopay stack purpose-built to match your business needs – today and as you scale.
