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Rewards Now Paid Like Cash at Checkout
28 Jan
Summary
- Over 420 alternative payment startups emerged between 2020-2025.
- UPI accounts for over 83% of India's digital payment volumes.
- Sector raised $418 million across 88 equity rounds.
Between 2020 and 2025, India has seen an explosion of over 420 alternative payment startups. These innovative companies span reward-based payments, credit-on-UPI, 'Buy Now Pay Later' options, digital wallets, QR-led solutions, and stored-value systems. As of January 28, 2026, these platforms are increasingly integrating reward programs directly into the payment process.
UPI now constitutes over 83 percent of India's digital payment volumes, processing 185.8 billion transactions in FY25 alone. This massive scale means transaction volume is no longer the primary constraint. Rewards-based payments are now mainstream, significantly boosting incremental transactions and user engagement.
Newer models enable reward points, traditionally locked with issuers, to function as direct payment value at checkout. This enhances usability and aligns incentives across consumers, issuers, and merchants. For instance, TWID integrates these points into merchant checkouts, allowing stored value to be used instantly.
