Cash to Digital: UPI Adoption Among Micro Businesses in Mysore

Abstract

This research investigates the implementation and effects of the Unified Payments Interface (UPI) among micro businesses in Mysore, India, using a sample size of 214, with a focus on sectors such as street vendors, stationery shops, Kirana stores, and auto services. The study utilizes primary data gathered from surveys and focus group discussions, complemented by secondary literature. It employs descriptive and analytical methods, including Chi-Square tests, to evaluate the relationship between demographic factors and UPI usage. The research indicates significant UPI adoption among dynamic micro-level businesses, including fast food vendors and stationery shops. However, it also highlights challenges such as security issues, unreliable networks, and barriers related to digital literacy. The primary factors influencing adoption are customer demand and convenience, while perceived risks and transaction failures act as obstacles. Statistical analysis revealed no significant correlation between demographics such as age or gender and UPI usage, suggesting that the type of business is the primary factor affecting adoption. The study concludes that UPI enhances operations and financial management for small businesses; however, targeted actions—such as improved security, digital literacy initiatives, and better technological support—are essential to fully realize UPI’s potential in promoting financial inclusion. The findings provide important insights for policymakers, financial institutions, and technology providers to assist small businesses in embracing digital payments, thereby fostering economic growth in Mysore’s micro-business sector.