NPCI is a non-profit org set up by RBI and funded by different major banks. It acts as a trusted switch to connect banks and Payment service providers (PSPs).
NPCI makes sure that data flow between banks and payment apps are routed to the correct and verified destinations.
NPCI also exposes a bunch of non-financial interoperable APIs for everyone in the ecosystem. For example: Validate VPA/UPI ID, Bank list, etc.