Digital Payment Disruptions Hit 83% in India: Network Issues Plague Users

India’s digital payment landscape faces a critical challenge as 83% of mobile internet users conducting financial transactions report at least one monthly disruption due to poor network quality, according to a LocalCircles survey.

This figure marks a significant increase in reported issues, highlighting growing dependency on mobile data for financial activities.

Key Survey Findings on Digital Payment Disruptions

• Network disruptions affected 83% of users, up from 58% in 2024 and 68% in 2022.
• 91% of 3G, 4G, and 5G users now rely on mobile data for banking, compared to 85% in 2024 and 62% in 2022.
• The survey gathered over 52,000 responses from mobile internet users across 325 districts.

Frequent Transaction Failures Reported

The LocalCircles survey also detailed the high incidence of failed transactions directly linked to network reliability issues.

• 34% of respondents saw up to 10% of monthly digital payments fail due to poor networks.
• 12% reported failure rates between 10-20%.
• Another 33% experienced 20-50% of their transactions failing.
• A further 4% stated more than half of their monthly transactions did not complete.

Collectively, 37% of users encounter network-related failures in over a fifth of their monthly digital payment transactions.

Connectivity Speed and Reliability Concerns

Beyond direct transaction failures, the broader mobile connectivity experience is a persistent concern for a vast majority of users.

• 87% of respondents regularly face either connection disruptions or speed problems.
• Low speed was the primary issue for 50% of users.
• Frequent network disruptions were cited by 37% of users.

LocalCircles stated, “India’s digital payments problem is no longer one of adoption but one of dependability.”

UPI Growth Amidst Network Challenges

These findings emerge as India’s Unified Payments Interface (UPI) continues its exponential growth, becoming central to retail transactions.

• UPI processed a record 23.66 billion transactions, valued at ₹29.88 lakh crore, in July 2026.
• This volume accounts for 81% of all retail digital payments.
• India’s wireless subscriber base surpassed 1.3 billion in June 2026.

However, reliance on fixed-line alternatives for financial transactions is declining, with only 7% of respondents using broadband, DSL, or fiber, down from 12% in 2024.

Recommendations for Enhanced Reliability

To address these critical issues, LocalCircles has put forth specific recommendations to key regulatory and governmental bodies.

• It urged TRAI, the Department of Telecommunications, RBI, NPCI, and MeitY to implement transaction-level failure attribution.
• This attribution would help users identify if a failed payment stemmed from a bank, payment system, or telecom network.
• The organization also called for accelerated deployment of offline and low-bandwidth payment solutions.
• This includes NPCI’s proposed UPI Lite tap-and-pay facility for transactions up to ₹2,000.