PSU and mid-size banks deploy own QR-soundbox stacks to reclaim merchant float from PhonePe-Paytm
Banks are bypassing TPAPs to acquire merchants directly, chasing current-account deposits as system deposit growth slows to 11.5%. Indian Bank opened 384,000 merchant accounts in FY26 targeting 1 million, with average balances near ₹200,000. UPI hit 24,162 crore transactions worth ₹314 trillion, with merchants driving 63% of volume.
Mid-size and PSU banks are deploying proprietary QR/soundbox infrastructure to acquire merchants directly, capture current-account float and bypass TPAPs like PhonePe, Paytm, Google Pay, as deposit growth slows and CASA competition intensifies.