Axis Bank's digital payments platform Freecharge Payment Technologies Private Limited has received in-principle approval from the Reserve Bank of India to operate as a payment aggregator under both online and physical Payment Aggregator categories during the second quarter of FY27. According to the lender's investor presentation, this regulatory approval marks a significant development in Axis Bank's digital payments operations and reflects the bank's ongoing investment in technology infrastructure. The approval allows Freecharge to operate under PA-O1 and PA-P1 categories starting in FY27, enabling the platform to facilitate online payments by enabling merchants to accept payments from customers through multiple payment instruments and channels.
The approval comes as Axis Bank continues to demonstrate robust growth in its digital payments franchise. The bank reported 34% year-on-year growth in total UPI transaction value for the July-September quarter, maintaining a market share of around 38% by transaction volume in the UPI payer payment service provider (PSP) segment. As reported by The Economic Times, the lender recorded the lowest technical decline rates among the top 50 UPI remitter members during Q2FY27, highlighting the reliability and efficiency of its digital payment infrastructure. This strong performance in UPI transactions underscores Axis Bank's dominant position in India's digital payments ecosystem.
Digital transactions have become the dominant channel for Axis Bank's customer interactions, with 98% of the bank's total financial transactions by individual customers during the quarter being conducted digitally. The bank's mobile application, Axis Mobile, served approximately 16 million monthly active users, including around 12 million non-Axis Bank customers, demonstrating the platform's appeal beyond the bank's existing customer base. According to The Economic Times, this digital transformation reflects the growing role of digital channels in the bank's overall banking operations, with digital transactions accounting for 98% of total financial transactions by individual customers during the quarter.
Axis Bank continued to expand its merchant payments business, holding a market share of around 25.7% in terminal acquiring based on RBI data as of August 2026. The lender introduced an AI Soundbox in partnership with Hitachi Payment Services during the quarter, alongside other initiatives aimed at strengthening its digital offerings. As reported by The Economic Times, these technological advancements are part of Axis Bank's broader strategy to invest in payments innovation and digital banking capabilities, positioning the bank at the forefront of digital payment solutions in the Indian market.
