Payments companies see PoS pause on war-related imports squeeze

India’s digital payments ecosystem is facing a shortage of new point-of-sale (PoS) terminals as the West Asia crisis and memory chip supply issues in China have disrupted imports, industry executives said.

Nearly all PoS terminals used in India are imported by banks and fintech firms, making local supplies vulnerable to geopolitical disruptions.

Their demand has risen amid increasing digitisation of payments and merchants upgrading to terminals capable of processing mobile payments, tap-and-pay and chip-and-pin transactions. “We are running a backlog of nearly 200,000 deployments,” said Amrish Rau, chief executive officer of Pine Labs, one of the largest deployers of PoS terminals in the country.

“PoS demand has shot up because mid-market merchants prefer UPI on the PoS machine due to security and recon issues. 70% of PoS transactions are now on UPI,” Rau said.

Other significant PoS deployers include Paytm, Innoviti Payments, MSwipe, Razorpay and Worldline, which has been recently acquired by online payment aggregator Billdesk.

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Prices Rise

Industry insiders said prices for such devices have increased by 15-20% due to supply constraints, putting pressure on business margins for payment firms. Devices priced at Rs 8,500 six months ago now cost more than Rs 10,000, they noted.

Most PoS hardware deployed in India is built by French manufacturer Ingenico and Chinese player Pax.

“Most of these terminals are deployed on behalf of banks and they are not in a position to renegotiate the pricing of these deployments, hence an increase in price of terminals creates problems for merchant acquirers,” founder of a digital payments startup said on condition of anonymity.

This, along with supply shortfall, is prompting major deployers to extend terminal lifecycles through servicing rather than replacement.

“Given the pricing challenges, we are really sweating these assets to the maximum. Previously if the life of a terminal was five years, we are now trying to push it to seven or eight years,” said Rajeev Agrawal, chief executive officer of Innoviti.

He noted that most PoS vendors had stopped stocking terminals in India. They import them only when they have an order from fintech firms. “This has pushed up the timelines for getting orders as well, thereby delaying deployments,” Agrawal said.

Existing customers seeking replacements for five-plus-year-old devices account for a significant chunk of demand for new terminals. Fresh deployments are growing at a steady pace of around 5% year-on-year, according to data from the Reserve Bank of India.

In FY25, driven by aggressive growth from RBL Bank, deployment of new PoS terminals jumped 24% — from 8.9 million in March 2024 to 11 million in March 2025. RBL Bank’s terminal count surged to 2.5 million from 863,000 in the previous year. However, RBL has slowed new deployments in FY26.

“Other than merchants switching between players the PoS market growth going forward will be steady state,” Agrawal said.

While RBI data shows around 761 million QR codes in the country, this figure is inflated by significant double counting as many merchants display multiple stickers.