India's rapid adoption of digital payments, especially the Unified Payments Interface (UPI), is fundamentally reshaping how consumers interact with cash. While the total volume of cash in circulation continues to climb, data reveals a significant decline in the amount of money withdrawn from individual ATMs across the country.
Digital Payments Reshape Cash Usage
According to Deepak Shenoy, CEO of CapitalMind, the amount of cash withdrawn per ATM has fallen by approximately 20% since 2022, even as the number of ATMs has remained relatively stable. This trend indicates a clear shift away from ATMs for routine transactions, despite an overall increase in currency levels.
“While the number of ATMs in India is the same as 2022, the amount of money withdrawn per ATM is about 20% lower now,” Shenoy noted, suggesting that rising currency levels are not being driven by increased ATM reliance.
Instead, Shenoy posits that larger cash withdrawals, likely for high-value purchases such as real estate, are increasingly being conducted directly from bank branches. This contrasts sharply with smaller, more frequent transactions, which have largely migrated to digital platforms like UPI.
UPI Dominates Transaction Volumes
The Unified Payments Interface (UPI) continues its impressive growth trajectory. National Payments Corporation of India (NPCI) data shows UPI transactions reached ₹29.8 lakh crore in August, nearing previous record highs. Its annual transaction volume has surged from 1.78 crore in FY17 to over 24,162 crore in FY26, a staggering 13,000-fold increase over a decade.
The Reserve Bank of India’s Payment System Report for December 2025 further underscores this shift. India now processes 77.6 crore digital payment transactions daily, with UPI accounting for an overwhelming 85.5% of all payment volumes in the second half of 2025. UPI transactions soared to 12,191 crore in H2 2025, up from 1,530 crore in H1 2021.
Declining Debit Card Use and Evolving Payment Landscape
The rise of UPI has had a direct impact on other payment methods, most notably debit cards. Debit card transaction volumes plummeted by 67% between calendar years 2021 and 2025, as consumers increasingly opt for UPI-based payments for everyday purchases like groceries, food, and transport.
While UPI handles the bulk of transaction volumes, other systems cater to different needs. The Real-Time Gross Settlement (RTGS) system, for instance, accounted for only 0.1% of transaction volume but an impressive 68.6% of total transaction value, highlighting its role in large-value transfers. Credit card spending also saw a sharp increase, reaching ₹23.2 lakh crore in 2025, up from ₹8.9 lakh crore in 2021.
This evolving landscape suggests that cash is not disappearing but rather changing its role. While it remains crucial for high-value transactions, its role in smaller, routine payments has been significantly diminished by the pervasive influence of UPI, leading to fewer withdrawals per ATM despite more cash in circulation overall.