India’s UPI initially attracted Indonesia’s interest but Jakarta’s interest is now in much more than that
The architecture of that platform. Indeed, officials are now looking to integrate identity verification, document storage and payments into a unified system or the India Stack and not just a separate achievement.
That architecture works because the pieces are in concert. Aadhaar is a key to identity for more than 1.4 billion people, DigiLocker makes secure digital documents and UPI sends money between the two.
It’s that interlocking design and not just the specific tool that Indonesian policymakers consider to be the real lesson to learn.
Indonesia has already started to make some progress
At a Digital Identity Forum in Jakarta in December 2025, an official from the National Economic Council said digital transformation is not about moving old services online but about rethinking government work.
That view is being tested in the welfare pilot in Banyuwangi, East Java, where biometric tests with existing population data are used to get people cash and food assistance.
And the motivation is financial and technical, not just technical. Indonesia allocates more than IDR 500 trillion a year to social protection programs but much of that goes to the wrong recipients, and that is a challenge with nearly 300 million people.
If the pilot works, governments will expand it to at least 32 cities in 2026 and take it to the whole country. Indeed, talks between the two governments’ finance ministries had already begun to talk about UPI-like rails to settle bilateral trade and financial inclusion.
And now that payment conversation seems to have opened the door to a much bigger conversation.
India’s entire DPI export agenda is built on four pillars
UIDAI/India Stack, the open-source MOSIP platform, RuPay and Diksha, and UPI itself is still the world’s fifth largest payment network in terms of volume. Some don’t believe that this model can be reproduced.
Economist Anupam Manur of the Takshashila Institution has wondered how easily “public good” justifications can be extended from UPI to other state-backed digital platforms.
As UPI was 10 years old and handled 16.6 billion transactions in a month, researchers found that the system also generated a growing body of behavioral data and privacy protection in India that hasn’t been updated.
Digital ID and DPI in countries like Brazil, Nigeria and South Africa are governance tools as well as tech tools in their own right because they are the gatekeepers of who can enter the digital economy.
For Indonesia this playbook could mean more targeted welfare, financial inclusion and even homegrown interoperable systems for its economy not reliance on infrastructure built elsewhere.
