Government Plans to Use UPI Data to Measure Education and Healthcare Growth

New initiative could provide more timely data on private-sector activity and strengthen the measurement of India’s services economy.

With UPI now widely used for everyday payments, the Central Government is looking to use transaction data for more than just tracking digital payments. The Ministry of Statistics and Programme Implementation (MoSPI) is exploring the use of UPI data to measure activity and growth in the private education and healthcare sectors.

The initiative is part of the proposed Index of Services Production (ISP), which is being developed to provide a clearer picture of India’s economic activity and the performance of the services sector.

UPI Data to Track Education Spending

The proposed index already covers sectors such as hospitality, transportation and information technology. However, reliable monthly data on education and healthcare has been limited.

Education contributes around 7.2% of the services sector’s Gross Value Added (GVA), while healthcare accounts for about 3%.

Under the new approach, the government plans to use UPI Merchant Category Code (MCC) data to identify spending at private schools, colleges, vocational training institutions, hospitals and laboratories.

For example, when a consumer pays school or college fees through UPI, the merchant category code can help identify the nature of the payment. However, transaction values alone will not be used to determine sectoral growth.

Healthcare Activity Also in Focus

Education-related UPI data is expected to be combined with the Consumer Price Index (CPI) for Education to estimate real growth in the sector.

Similarly, UPI payments made to doctors, dentists, hospitals, nursing homes and diagnostic laboratories could be classified using merchant codes. This information would then be assessed alongside the CPI for Health to estimate monthly activity in the private healthcare sector.

Services Data Coverage to Expand

At present, the services index covers around 60% of the sector’s GVA. With education and healthcare included, coverage is expected to rise to 78.4%.

Government spending will be measured through the Public Financial Management System (PFMS), while private-sector and household spending could be tracked through aggregated UPI data.

The government’s stated objective is not to monitor individual consumers or their daily transactions, but to use aggregated information to understand overall spending patterns in education and healthcare.

The expanded data could help policymakers assess economic activity more accurately and develop policies based on a broader and more timely picture of India’s services sector.