The National Payments Corporation of India (NPCI) is working on a unified, interoperable Soundbox system for merchants, the Economic Times reported. This will allow both large retailers and small businesses to accept UPI payments from any QR code, regardless of the app they use, and to use a single device to manage settlements. 

Why this matters to small businesses: At present, merchants use multiple QR codes from different payment apps such as PhonePe, BharatPe and Paytm. Each QR code is linked to a separate Soundbox, so merchants have to buy subscriptions for multiple devices, which cost between Rs 100 and Rs 150 per month.

If NPCI builds a common Soundbox infrastructure, it will reduce merchants’ costs. They will no longer need to invest in multiple devices, as all transaction confirmations will happen via the same Soundbox.

How will this impact UPI firms? If the Soundbox gets standardised across platforms, it could dent the revenues of big payment firms such as PhonePe, BharatPe and Paytm, while putting further strain on smaller UPI apps, which are already struggling due to zero MDR on UPI transactions.

“Soundbox itself became important because UPI has a weak direct monetisation model under zero MDR,” Pranav Pai, founding partner and chief investment officer at 3one4 Capital, told MediaNama. “If Soundbox revenue also falls, smaller UPI apps will find it harder to justify deep merchant investments unless they can monetise through credit, working capital, SaaS, advertisements or commerce. These are not immediately tangible profit lines for most of the small service providers.”

While this does not render UPI unviable overnight, it does make the current model more fragile. According to the latest data from the NPCI, India processed 22.34 billion UPI transactions in April 2026. 

“A network of this scale cannot be funded only through indirect monetisation and government subsidies forever. If UPI remains zero MDR and device revenue also gets standardised down, the ecosystem will again depend on cross-subsidy rather than sustainable unit economics. A baseline MDR should also be considered,” said Pai.

His comments come two months after a parliamentary committee urged the Centre to reintroduce MDR on UPI transactions, saying “the absence of MDR makes the UPI ecosystem financially unsustainable.”

How will the single-Soundbox model work? A merchant can register the interoperable Soundbox in any payment app and link all QR codes to that app, ET reported, citing people familiar with the matter.

The device will confirm transactions via a voice message, regardless of which app or QR code is used for payment acceptance.

Currently, you cannot receive confirmations for payments made through a different provider on your Paytm Soundbox.

Questions that remain unanswered

1. A centralised NPCI Soundbox platform would aggregate real-time merchant transaction confirmation data from all UPI apps into a single database. What are the data governance implications? Who owns this data, under what legal framework is it stored, and can it be accessed by law enforcement or used for commercial profiling of merchants? 

2.  In April 2026, 22.34 billion UPI transactions were processed. Of these, consumers made 14.11 billion transactions to merchants. Many of these transactions occur at offline stores, and the Soundbox confirms each transaction through voice alerts. If the interoperable soundbox platform faces technical failures or downtime, what contingency measures are in place? Does centralising this confirmation layer create systemic risk?

MediaNama queries sent to PhonePe and BharatPe remained unanswered at the time of publishing.

Also Read:

• Govt Pushes Back Against MDR Rumors on UPI, Calls It ‘Baseless’ Speculation
• Govt Sources Indicate MDR of 0.2%-0.3% on UPI: What India Can Learn from Brazil’s Pix
• Why Zero MDR is a dangerous play with incentives, and will hurt financial inclusion and businesses