Impact of UPI on Consumer Spending Behaviour in India

The rapid expansion of digital payment systems has significantly transformed consumer financial behaviour in India. The Unified Payments Interface (UPI), introduced by the National Payments Corporation of India (NPCI), has emerged as the dominant platform for cashless transactions. This study investigates the impact of UPI usage on consumer spending behaviour, focusing on key determinants such as ease of use, security perception, trust, and convenience. A quantitative research design was adopted, and primary data were collected through a structured questionnaire administered to 312 respondents from urban and semi-urban regions of India. Statistical techniques, including multiple regression analysis, one-way ANOVA, and descriptive statistics, were employed to evaluate the relationships between variables. The data were collected during the period January–March 2024. The findings reveal that convenience (β = 0.45) and trust (β = 0.41) are the most significant predictors of consumer spending behaviour via UPI. Ease of use also exerts a strong positive influence (β = 0.38), while security perception indirectly affects spending through its effect on trust. The study further indicates that increased reliance on UPI is associated with higher impulsive spending tendencies and reduced dependence on cash-based budgeting. Demographic analysis reveals that younger users (18–30 years) exhibit significantly higher UPI usage intensity and greater spending flexibility compared to older age groups. This research contributes to the growing body of literature on digital payments by providing empirical evidence from the Indian context. It offers actionable insights for policymakers, fintech firms, and financial institutions seeking to promote responsible digital payment adoption. The study concludes that while UPI enhances financial inclusion and operational efficiency, it also necessitates concerted consumer education efforts regarding financial discipline and cybersecurity awareness.