India Macro & Digital Public Infrastructure
India Macro Context
PhonePe's growth is underpinned by India's structural macroeconomic tailwinds. The country is projected to become the world's 3rd largest economy by 2030 with GDP reaching $7T+. Rising middle-class population (400M → 600M by CY30), increasing digital adoption (900M internet users), and government-led Digital Public Infrastructure (Aadhaar, UPI, Account Aggregator) create a uniquely favorable environment for digital financial services. UPI has become the world's largest real-time payments system, processing more transactions than all card networks globally combined.
Analyst View
GDP CY25E: $5.0T (5th largest globally).
GDP CY30E: $7.3T (3rd largest projected).
Real GDP CAGR: 6.5% (FY25-30).
Per capita income: $3,500 → $5,000 by CY30.
| Metric | CY20 | CY24 | CY30E | CAGR |
|---|---|---|---|---|
| Internet Users (M) | 622 | 900 | 1,100 | +5.8% |
| Smartphone Users (M) | 500 | 750 | 950 | +6.5% |
| Bank Accounts (M) | 1,050 | 1,400 | 1,600 | +4.3% |
| UPI-linked Accounts (M) | 250 | 500 | 800 | +8.0% |
| Middle Class Population (M) | 350 | 430 | 600 | +5.6% |
Analyst View
CY24 TPV: ₹246T (~$2.9T).
CY24 volume: 172B transactions.
Larger than Visa + Mastercard combined (by volume).
CY30E: ₹710T TPV projected.
What is India Stack?
India Stack is a set of open APIs and digital public goods that enables paperless, presence-less, and cashless service delivery. It includes identity (Aadhaar), payments (UPI), data sharing (Account Aggregator), and document verification (DigiLocker). This infrastructure has enabled companies like PhonePe to build scalable financial services.
| Layer | Infrastructure | Coverage | Impact |
|---|---|---|---|
| Identity | Aadhaar | 1.4B enrollments | Instant KYC, eKYC |
| Payments | UPI (NPCI) | 500M linked accounts | Real-time bank transfers |
| Data | Account Aggregator | Expanding | Consent-based data sharing |
| Documents | DigiLocker | 300M+ users | Digital document storage |
| Commerce | ONDC | Emerging | Open e-commerce network |
| Credit | OCEN | Emerging | Open credit enablement |
Key Macro Themes Supporting PhonePe Growth
Rising Middle Class
India's middle class to grow from 430M to 600M by CY30. Rising disposable incomes drive digital payments and financial services adoption.
Digital India Push
Government prioritizing digital payments, financial inclusion, and DPI. Zero-MDR policy, UPI incentives, and Jan Dhan accounts.
Tier 2+ Opportunity
55% of UPI TPV from Tier 2+ cities. Per capita UPI usage only 20-25% of Tier 1 levels, indicating massive growth runway.