Cash or cheque retail activity
A cited estimate described nearly all retail transactions at the time as cash- or cheque-based, demonstrating how deeply established physical payment habits were.
Research archive · Reviewed 28 August 2026
Beyond cash: digital payments in India
An editorial review of field research examining why access to an account does not automatically lead consumers and small merchants to adopt digital payments.
About this report
Financial inclusion goes beyond opening accounts
India’s expansion of bank accounts, identity infrastructure and mobile connectivity created the foundations for broader participation in formal finance. The archived research behind this page asked a different question: what makes people and merchants use digital payment tools in everyday life?
Its central finding remains useful. Access is only one part of inclusion. People must also be able to receive, store and spend money digitally, while nearby merchants need affordable tools, workable supplier arrangements and sufficient customer demand.
This page preserves the study’s principal observations as historical research. Figures describe its original sample and period; they should not be interpreted as current national indicators.
Original context
Why the cash ecosystem mattered
The source report used contemporary estimates to illustrate the gap between formal financial access and routine digital use. These numbers are retained only as archived study context.
Debit-card payments
A contemporary dataset reported limited card use for purchases, despite increasing account and card access.
Merchant acceptance
A cited estimate indicated that only a small share of merchants accepted digital payments, restricting opportunities for consumers to use them.
Archived estimates from sources cited by the original study; not verified as current in 2026.
Research design
Studying consumers and merchants together
The research covered more than 2,500 respondents in metropolitan, smaller-city and rural settings. It included Mumbai, Hyderabad, Kota, Visakhapatnam and communities around Guntur and Jaunpur. Quantitative surveys were supplemented by ethnographic work with low-income consumers and small merchants.
The sample intentionally included users and non-users of digital payment systems. It was not designed to represent India’s full population.
- Awareness and interest
Understand what shaped awareness among non-users and whether they were interested in trying digital instruments. - User experience
Examine experiences with debit cards, mobile money and online bank transfers. - Adoption strategies
Identify practical ways to encourage responsible adoption by consumers and merchants.
Consumer research insights
What shaped a consumer’s decision to switch?
Satisfaction was generally high
Current users valued convenience, speed and reduced need to carry cash. The study recorded strong willingness to recommend cards, mobile money and bank transfers.
Understanding remained shallow
Many non-users had limited knowledge of how digital instruments worked or where they could use them. That uncertainty reduced interest in adoption.
Income often entered as cash
Consumers who were paid and saved digitally were more likely to transact digitally. Cash-based income made a digital payment habit harder to sustain.
Nearby use cases were scarce
Cardholders often used cards only at cash machines because local merchants did not accept them. Digital options were associated more with large purchases than daily spending.
Cash created visible problems
Managing change, waiting for low-value transactions and tracking household expenditure were recurring frustrations that suitable digital tools could address.
Utility must precede persuasion
Awareness campaigns alone are insufficient when people cannot receive money digitally or use it at the places where they shop and travel.
Merchant research insights
Acceptance depended on the wider business network
Small merchants were not isolated decision-makers. Their payment choices were connected to customers, suppliers, banks, device costs and demand for working capital.
Accepting merchants saw practical value
Merchants already taking digital payments reported benefits such as speed, safety, easier change management and customer appeal.
Non-acceptors lacked awareness
Many merchants did not know that they could accept cards, mobile money or transfers, while only a portion of those aware expressed interest.
Supplier payments reinforced cash
When suppliers expected cash, merchants needed to retain physical money. Digitising only the customer-facing transaction left this constraint unresolved.
Upfront expense increased risk
Equipment deposits, fees and account requirements discouraged merchants who were unsure whether customer demand would justify the investment.
Safety and change were opportunities
Concerns about storing cash and finding correct change created tangible use cases for simpler payment methods.
Working capital was a strong incentive
Transaction histories could potentially support credit assessment, making appropriate business finance a meaningful reason to accept digital payments.
Action framework
Design for the whole payment ecosystem
For consumer adoption
Digitise incoming funds
Make it practical for wages and public transfers to enter accounts directly, with clear consent and accessible support.
Enable small-value saving
Offer flexible products that help households build a digital balance without complex commitments or unclear charges.
Solve routine cash problems
Prioritise transport, bills, change management and spending records—frequent uses where convenience is easy to recognise.
Explain concrete use cases
Replace abstract promotion with plain guidance, transparent terms and supported opportunities to try a service.
For merchant acceptance
Lower the cost of trial
Reduce upfront charges and simplify onboarding so merchants can evaluate demand before making a large commitment.
Connect supplier payments
Address retailer-to-distributor flows so accepting a digital customer payment does not create a cash shortfall upstream.
Link data to useful services
With appropriate safeguards, transaction records may help eligible merchants demonstrate activity when seeking working capital.
Communicate business value
Focus on security, speed, customer convenience and reduced change handling while stating costs and limitations clearly.
Methodology
How to read the evidence
The original project focused on lower-income consumers and small merchants across rural, semi-urban and urban locations, with varied levels of payment experience. It combined quantitative survey responses with deeper qualitative investigation.
The approach is valuable for identifying behaviour, barriers and possible interventions. It does not support a current nationwide estimate, and the payment environment has evolved considerably since the fieldwork.
Responsible use: treat the findings as historical hypotheses to test with current local evidence, not as a basis for assuming present-day preferences or access.
FAQ
Using this archive
Key guidance on scope, currency and interpretation.
Is this a current survey of digital payments in India?
No. The fieldwork took place in 2015. The page preserves its principal findings for historical and methodological reference.
Was the sample nationally representative?
No. It intentionally covered a range of users, non-users, settlement types and selected locations, but was not designed to estimate the entire country.
Can the percentages be used as 2026 market figures?
No. They describe the original study or sources available at that time. Current planning should use recent, independently verified data.
Why study consumers and merchants together?
Consumer use depends on acceptance, while merchant acceptance depends on demand and supplier arrangements. Studying only one side can miss the reinforcing nature of cash ecosystems.
What was the main consumer barrier?
No single barrier explained adoption. Limited awareness, cash-based income, insufficient acceptance and a lack of compelling everyday uses interacted.
What was the main lesson for merchant adoption?
Reduce trial risk and consider the full business network, including suppliers, account requirements, customer demand and access to useful financial services.
Questions about this archive?
Contact Global Innovation Exchange for editorial corrections or general information.