As an Indian Bitcoiner who recently returned home, I found myself using UPI digital payments repeatedly for my everyday expenses.
UPI (Unified Payments Interface) is India's real-time bank-to-bank payment system that has become ubiquitous for making payments by scanning QR codes or using phone numbers. It has enabled even street vendors and small shops to accept online payments.
Given the difficulty of getting cash change and vendors needing to maintain card machines, UPI is often the only payment option.
And I have to admit it; It's incredibly fast, cheap, and easy to pay merchants via UPI apps compared to fumbling around for bitcoin Lightning wallets, custodial or non-custodial. Money moves instantly for free and the process is familiar to all parties.
While I am a big proponent of private, decentralized and censorship-resistant money, the convenience of bitcoin and UPI is hard to ignore. UPI processes over 14 billion monthly transactions across over 450 banks commission-free.
In comparison, Lightning faces low liquidity, channel balancing headaches, and clunky user experiences (which continue to improve with custodial wallets with some tradeoffs).
Of course, the privacy implications of an almost entirely digital system controlled by centralized third parties make me cringe and sound dystopian. But most Indians happily give up privacy for convenience again and again.
So even as a Bitcoiner, I don't see most Indians abandoning UPI to start using bitcoin Lightning en masse for everyday payments anytime soon, apart from bitcoin's circular economies. The incentive must be there. And let's be honest: Lightning still confuses Bitcoiners, let alone my uncle!
Perhaps in the future, privacy concerns or currency devaluation could lead Indians to pay with bitcoin. But for now, UPI has too much momentum and network effect.
