New Delhi, Oct. 31 -- Industry body India Fintech Foundation (IFF) has written to the Finance Ministry warning that more than 80% of Unified Payments Interface (UPI) transaction volumes are currently handled by just two third-party app providers (TPAPs). The group has urged policy intervention to prevent systemic concentration and ensure fair competition within India's most critical digital payments channel.

In its letter, IFF said the current structure poses "systemic concentration risks" that could stifle innovation and competition over time. It called on the government to take corrective steps to level the playing field for smaller players and sustain diversity within the ecosystem.

IFF has proposed a 10% cap on UPI incentive payouts...