Indian digital payments ecosystem is witnessing new PoS terminal shortages as geopolitical tensions in West Asia and memory chip supply disruptions from China continue to impact imports, according to industry executives.

Key Highlights

• Indian digital payments market faces PoS terminal shortages due to geopolitical and chip supply disruptions.
• Rising demand for UPI-enabled payment devices has increased deployment delays and pushed terminal prices higher.

The disruption has affected banks, fintech companies, and merchant acquirers that heavily rely on imported PoS hardware for expanding digital payment infrastructure across the country.

Industry leaders said rising demand for tap-and-pay, UPI-enabled, and chip-and-pin payment terminals has intensified supply constraints, resulting in deployment delays and higher device costs.

Rising Demand & Cost Intensifies Supply Pressure

Industry executives said most PoS terminals deployed in India are manufactured by global players such as Ingenico and Chinese company PAX Technology, making India’s supply chain vulnerable to external geopolitical and manufacturing disruptions.

Amrish Rau, CEO of Pine Labs, said the company is currently facing a significant deployment backlog. “We are running a backlog of nearly 200,000 deployments. Demand for PoS terminals has surged as merchants increasingly prefer UPI-enabled PoS devices for better transaction security and reconciliation processes. 70% of PoS transactions are now on UPI.”

Executives across the payments ecosystem said prices of PoS terminals have risen by nearly 15–20% over the last six months due to component shortages and import delays. Devices previously priced around Rs 8,500 are now reportedly costing over Rs 10,000, increasing pressure on margins for fintech firms and merchant acquirers.

Rajeev Agrawal, CEO of Innoviti Payments Solutions, said companies are now extending the operational life of terminals instead of replacing them. “We are really sweating these assets to the maximum. Many PoS vendors have stopped stocking devices locally and are importing units only after receiving confirmed orders, increasing deployment timelines."

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India’s Digital Payments Growth Continues

Despite supply constraints, India’s digital payments market continues to expand rapidly, driven by rising merchant digitisation and increasing consumer preference for contactless and UPI-based transactions.

According to Reserve Bank of India data, PoS terminal deployment grew sharply in FY25, increasing from 8.9 million terminals in March 2024 to nearly 11 million by March 2025.

Industry experts believe the shortage highlights India’s growing dependence on imported payment infrastructure and may accelerate efforts to strengthen domestic electronics manufacturing and fintech hardware production.

Market observers expect demand for smart PoS terminals to remain strong as merchants increasingly adopt integrated digital payment solutions combining UPI, cards, and contactless payments.