ZET Revolutionizes UPI Payments with TPAP License
Indian fintech startup ZET has recently secured a Third-Party Application Provider (TPAP) license from the National Payments Corporation of India. This development enables ZET to integrate UPI payments using RuPay credit cards, marking a significant milestone for the company and its users.
What Does This Mean for ZET Users?
With the TPAP license, ZET introduces "ZET UPI," allowing credit card users to make payments across the UPI merchant network. This feature brings a flat 2% cashback on transactions, enhancing the value proposition for users. Additionally, ZET offers bundled rewards with its subscription services.
- Core Product: ZET’s primary offering is a fixed-deposit-backed credit card, often serving as the first credit card for many users. These cards are lifetime free and can now be linked to UPI.
- Target Audience: Approximately 75% of ZET’s cardholders are first-time credit card users, particularly targeting India’s "credit-invisible" population, estimated at 400 million individuals.
ZET’s Unique Approach to UPI
Unlike other fintechs, ZET is not using UPI as a primary customer acquisition tool. Instead, users must first acquire a ZET card before linking it to UPI. This strategy allows ZET to focus on scaling its credit services without relying on UPI as a growth lever.
- Understanding Customer Behavior: Integrating UPI helps ZET gather valuable insights into customer spending habits, such as food, dining, and online purchases. This data aids in building proprietary underwriting models, enabling one-click credit experiences.
- Continuous Underwriting: ZET uses data from FD amounts, card utilization, repayment behavior, and spending patterns to continuously update its risk assessments.
Early Success and Adoption
ZET received the TPAP license in December 2025, and by January 2026, nearly 50% of eligible users had linked their RuPay credit cards to the ZET app. With around 1 million users eligible for the UPI product, the company anticipates monthly transaction volumes to reach Rs 100 crore within three months.
Lending Ambitions and Future Plans
ZET’s business model is deeply rooted in credit underwriting and lending. The company partners with three banks, including Indian Overseas Bank, for its credit card offerings. In October, ZET acquired a non-banking financial company (NBFC) license, aiming to operationalize it for lending by February.
- Investor Backing: ZET is supported by notable investors like Peak XV Partners, General Catalyst, and Nexus Venture Partners. The company’s diversified infrastructure, including its own NBFC and TPAP, has attracted significant investor interest.
The Bigger Picture
ZET’s focus on "India Two"—customers earning between Rs 15,000 and Rs 50,000 a month—addresses a crucial gap in the credit market. By providing an entry point into the formal credit ecosystem, ZET empowers users who are typically ineligible for unsecured credit cards.
Questions for Thought
- How will ZET’s approach to UPI integration influence other fintech strategies?
- What impact will ZET’s focus on the "credit-invisible" population have on the broader financial ecosystem in India?
ZET’s journey reflects a strategic blend of innovation and market understanding, positioning it as a key player in India’s fintech landscape. As the company continues to evolve, its impact on the credit market and user accessibility will be closely watched.
