Expanding to India Using RazorPay's Expansion Playbook

5 Things I Learned And A Framework For Your Own Payments Strategy

Last week, I introduced the Leapfrog Markets series with a simple premise. India, Brazil, and Indonesia have built payment systems that make Western infrastructure look like a museum exhibit. They skipped the painful decades of legacy rails and went straight to mobile-first, government-backed systems that process trillions annually.

Today, we go deep on India. And we’re not going in blind.

Razorpay, one of India’s dominant payment processors, recently published its expansion playbook for global businesses looking to crack the Indian market. I’ve spent the past week pulling it apart. What follows are the five strategic lessons that matter most to anyone serious about entering this $4 trillion economy, along with a framework for actually acting on them.

If you want to go through the playbook yourself, you can download it here: Razorpay’s India Expansion Playbook.

Let’s get into it.

1. India Doesn’t Evolve. It Leapfrogs.

This is the framing that changes everything.

Most markets follow a predictable arc. Cash gives way to cards. Cards give way to digital wallets. Infrastructure develops gradually over decades. India looked at that path, decided it was too slow, and built something entirely different.

The numbers tell the story better than any analyst could. Less than 6% of Indians own a credit card. In most markets, that would signal underdevelopment. In India, it signals irrelevance. Digital payments have soared anyway because the country skipped the card era entirely.

India also skipped the broadband phase. Today, 90% of Indian internet users access the web via smartphones. They never had landlines. They never had dial-up. They went straight from nothing to mobile-first in a single generation.

The playbook puts it bluntly: what worked a decade ago globally might never have existed here, and what wins today didn’t even exist five years ago.

This isn’t a market where you can port over your European or American playbook and expect results. India builds what it needs, faster and cheaper than anyone else. If you want to succeed, you don’t just localise. You leap, the way India does.

2. UPI Is the Entire Game

If there’s one message the playbook hammers home, it’s this: mastering UPI isn’t optional. It’s the foundation.

The Unified Payments Interface now accounts for 83.7% of all digital payments in India. That’s not a typo. More than four out of every five digital transactions flow through UPI. Cards, netbanking, and everything else combined make up the remaining 16%.

The scale is staggering. UPI processed 6,900 transactions every second in FY25. Total transaction value hit ₹2,862 trillion, roughly $340 billion. With over 20 billion monthly transactions, UPI accounts for more than 80% of India’s retail digital payments.

But here’s what foreign companies miss. UPI isn’t just a payment method. It’s the infrastructure that 400+ banks use to coordinate in real time. Digital tokens replace card details in milliseconds. AI fraud systems scan millions of patterns every second. All of this happens invisibly to the user.

To businesses, it’s anything but invisible. The regulatory complexity alone would fill a semester-long course. RBI’s Liberalised Remittance Scheme limits. Automatic PAN verifications. Tax Collection at Source calculations. All is happening in the background of every transaction.

The playbook makes a sharp distinction. Businesses that want to succeed in India must master UPI, not just accept it. There’s a difference between bolting on UPI as another payment option and building your entire checkout experience around it. The former gets you in the door. The latter gets you market share.

3. The Next 500 Million Customers Aren’t Where You Think

Every global brand chasing India focuses on Mumbai, Delhi, and Bangalore. The playbook says they’re looking in the wrong place.

The next 500 million customers won’t come from metros. They’ll come from smaller cities and towns. These consumers are younger, aspirational, vernacular-first, and digitally native in ways few Western markets can match.

The data backs this up. Nearly 60% of India’s e-commerce shoppers today come from Tier 2 and Tier 3 cities. UPI usage in these regions has surged by 118%, becoming the default way to pay. India’s e-retail market has already hit $60 billion, and most of that growth is coming from outside the major metros.

This creates a strategic problem for companies used to targeting affluent urban consumers. Products, payment experiences, and messaging must reflect this ground reality. A checkout flow designed for a Delhi professional with a credit card won’t convert a first-time buyer in Jaipur paying via UPI.

The playbook coins a phrase that should become part of every expansion strategist’s vocabulary: payment-market fit.

In India, product-market fit alone isn’t enough. You need payment-market fit. Your payment experience must match how your actual customers want to pay, not how your existing customers in other markets pay.

Win UPI, win India. It’s that simple.

4. Low Trust, High Tech

Here’s the paradox that trips up most foreign companies.

Indians embrace technology faster than consumers in many developed markets. Smartphone adoption, app usage, and digital transaction volumes all point to a population comfortable with technology. But that adoption comes with caution. Consumer trust must be earned.

Indians trust payment experiences that are transparent, secure, and immediate. Delayed confirmations create anxiety. Hidden fees destroy confidence. Complex authentication flows signal incompetence.

This is precisely why UPI has thrived. The system delivers on all three counts. Payments confirm instantly. Costs are visible upfront. The flow is tap, confirm, pay, all in three seconds.

The proof shows up in transaction patterns. 86% of person-to-business UPI payments are for ₹500 or less, roughly six dollars. That’s not a sign of low purchasing power. That’s proof of consumer confidence in small, daily transactions. When people trust a payment system completely, they use it for everything, including amounts so small that friction would otherwise push them back to cash.

For companies entering India, this means obsessing over success rates.

The playbook mentions 90%+ UPI success rates as a benchmark. Drop below that and you’re not just losing transactions. You’re losing trust. And in a low-trust, high-tech market, trust is the only currency that compounds.

5. Five Sectors Where UPI Fluency Equals Market Success

The playbook identifies five digital sectors where international businesses have the most significant opportunities: SaaS, EdTech, Travel, Digital Media, and Retail. What connects them all is that they’re already scaled, still growing fast, and increasingly UPI-first.

India is one of the world’s fastest-growing SaaS markets and uniquely card-light. The market is projected to reach $15.7 billion by 2030, growing at 26% annually. Two out of three digital merchant payments are anticipated to happen via UPI. For SaaS companies, this means self-serve subscriptions and one-time purchases need to work seamlessly on UPI, especially in Tier 2 and Tier 3 cities where card penetration remains low.

EdTech tells a similar story. The online education market is forecast to hit $38.5 billion by 2030. Demand in smaller cities surged 32% in 2023 alone. UPI is fast becoming EdTech’s preferred payment mode because it reaches students, parents, and teachers in semi-urban markets that cards can’t touch.

Travel is booming. India’s outbound travel market is growing rapidly, and UPI already powers approximately 40% of online travel bookings. The playbook includes a case study of a global travel platform that integrated Turbo UPI and Native OTP, embedded compliance into checkout, and achieved a 25%+ boost in success rates while outperforming card-only rivals.

Digital media, notably gaming, represents a massive opportunity. India has over 488 million active gamers. The gaming market is expected to reach $8.36 billion by 2030. Online gaming is mobile-first, and on mobile, UPI dominates in-app purchases, wallet top-ups, and fantasy gaming deposits.

Retail rounds out the list. India’s FMCG market is set to grow from $245 billion in 2024 to over $1.1 trillion by 2033. UPI is already the default at checkout, from neighbourhood kiranas to direct-to-consumer sites. It powers QR code payments, cash-on-delivery replacements, and instant refunds.

The pattern is consistent across all five sectors. UPI fluency equals market success. Companies that treat UPI as an afterthought will watch local competitors eat their lunch.

Applying the Strategic Framework: How to Actually Enter India

Reading about opportunity is one thing. Acting on it requires a framework. Here’s how I’d approach India using the lens I apply to any expansion decision.

For Merchants Evaluating India as a Growth Market

Start with the fundamentals.

India offers a $4 trillion GDP growing fast enough to add a Switzerland-sized market every few years. $70 billion in FDI flowed into the country during FY24. The digital base is 800 million internet users, with 96% accessing the internet via mobile devices. Digital payments crossed ₹2,862 trillion in FY25.

The opportunity score is high. But opportunity alone doesn’t make a market worth entering.

The real question is the potential for a land grab.

• Can you capture meaningful share before the market matures?

India’s low credit card penetration and UPI dominance actually work in your favour here. Western incumbents with card-first strategies are structurally disadvantaged. If you build UPI-native from day one, you’re competing on equal footing with local players, something that is rarely true in mature markets.

The execution checklist is straightforward.

• First, assess whether your product fits the five high-growth sectors where UPI fluency matters most.

• Second, determine if you can achieve payment-market fit, not just product-market fit.

• Third, evaluate whether your checkout can achieve 90%+ UPI success rates.

• Fourth, decide if you’re willing to build for Tier 2 and Tier 3 cities, not just metros.

If you answer yes to all four, India should be near the top of your expansion list.

For PSPs Considering India Through Partnership

The calculus is different for payment service providers. You’re not just entering a market. You’re potentially building infrastructure that serves other companies entering that market.

India’s regulatory complexity creates a moat for those who solve it. RBI compliance, LRS limits, TCS calculations, PAN validation, these aren’t just checkboxes. They are barriers that keep less committed competitors out. If you can offer international merchants a path to India without requiring a local entity or bank account, you become the unlock.

The playbook shows what’s now possible. Global platforms are going live with full local payment coverage. INR billing with USD settlement. Best-in-class success rates with optimised routing. All without the traditional months-long setup that kills momentum.

The strategic question for PSPs is whether to build this capability in-house or partner with a local player who’s already solved it. Razorpay has clearly positioned its playbook as an invitation to partner. Whether that’s the right path for your specific situation requires due diligence, but the option now exists in ways it didn’t five years ago.

The Decision Framework

When I evaluate any market for expansion, I look at three things.

• Opportunity: Is the addressable market large enough and growing fast enough?

• Information: Do I have enough data to make an informed decision about my potential performance?

• Landgrab: Can I capture share before incumbents lock up distribution?

India scores high on all three.

The $4 trillion economy with 1.4 billion people presents an opportunity. The playbook and the data it contains answer information. And the structural disadvantage of card-first Western players is that they have to answer land grabs.

The question isn’t whether India is worth entering. It’s whether you’re prepared for how India actually works. UPI-first. Mobile-first. Trust earned through instant, transparent experiences. Growth coming from cities you’ve never heard of.

If that sounds like a market you can win, India should be your next move.

Next Steps: Download the Full Playbook

I’ve only scratched the surface here.

The Razorpay playbook goes deeper on sector-specific dynamics, regulatory requirements, case studies of companies that got it right, and the technical details of UPI integration that matter for implementation.

If you’re a merchant evaluating India, a PSP considering partnership, or a payments professional trying to understand where the real growth is happening, you owe it to yourself to read the whole thing.

Download Razorpay’s India Expansion Playbook here: Your Passport to India’s Next Billion Customers

As the playbook makes clear, India rewards those who adapt. The companies that succeed won’t be the ones with the most significant budgets or the longest track records. They’ll be the ones willing to build for how India actually pays, not how they wish it paid.

That’s the leap. The question is whether you’re ready to make it.

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