Barriers to Digital Financial Adoption Among Marginalized Population in India: An ISM–MICMAC Framework Analysis

Despite fast developments in India’s digital payment infrastructure, as indicated by over 14 billion monthly Unified Payments Interface (UPI) transactions as of 2024, a structurally significant segment of the population is still excluded from meaningful digital financial involvement. This research examines the hurdles to digital financial adoption among India’s marginalized communities using interpretive structural modelling (ISM) and matrix multiplication applied to classification (MICMAC) analysis. Drawing on 11 theoretically grounded barriers discovered through a systematic assessment of the literature, expert elicitation and structured self-interaction assessment, the study develops a six-level structural hierarchy that identifies surface-level, structural and root-level constraints. In the MICMAC quadrant analysis, barriers are grouped into dependent, autonomous and linkage categories and the independent groups. The model identifies social and cultural norms (B6), irregular income and cash dependency (B7) and linguistic and illiteracy barriers (B10) as the principal independent/driver barriers. In comparison, perceived security and privacy risk (B1) and technological complexity (B4) are identified as dependent, surface-level barriers. This result is consistent with and adds to the arguments on sustainable development goal (SDG) 8—decent work and economic growth and SDG 10—Reduced Inequalities and the growing importance of digital banking, sustainability and inequality by providing one of the first applications of the ISM–MICMAC framework to the underprivileged population of India.