Unified Payments Interface (UPI) has transformed digital payments in India, making transactions seamless and cashless. But is it truly benefiting everyone, including the poorest of the poor? While UPI has simplified payments for millions, it has unintentionally affected beggars and daily wage earners who once relied on loose change.

Why Was UPI Introduced?

India introduced UPI in 2016 to promote digital transactions and reduce dependence on cash. It aimed to:

Global Acceptance of UPI

UPI is gaining global recognition, with countries like UAE, Singapore, France, and Nepal accepting UPI-based payments. Many nations are exploring partnerships with India’s NPCI (National Payments Corporation of India) to integrate similar systems into their economies.

UPI in India: Success or Challenge?

India has witnessed a digital payment boom with UPI, processing over 10 billion transactions monthly. While this has streamlined payments for businesses and individuals, it has raised concerns about marginalized communities being left behind.

Impact on Beggars and Street Vendors

With fewer people carrying cash, beggars and street vendors are struggling to receive small donations. Earlier, loose change was an easy and quick way for people to help the needy, but with UPI dominating transactions, this informal support has diminished.

Problem: Most beggars do not have bank accounts or smartphones to accept UPI payments.
Reality: Even if some beggars adopt UPI, many donors are unwilling to go through the hassle of scanning a QR code for small amounts.
Result: Reduced cash circulation has made life harder for the poor who rely on spontaneous generosity.

Can Beggars Open UPI Accounts?

Technically, yes. UPI accounts can be opened with basic KYC verification, but:

Most beggars lack documents and knowledge to open accounts.
Smartphones and internet access remain a luxury for them.

UPI: Pros and Cons

Advantages of UPI:

Convenience: Instant transactions anytime, anywhere.
Financial Inclusion: Encourages people to join the formal economy.
Transparency: Reduces unaccounted cash flow.
Low Transaction Costs: Affordable for small businesses and individuals.

Disadvantages of UPI:

Exclusion of Marginalized Groups: Beggars, daily wage workers, and elderly citizens often lack access.
Digital Divide: Urban-rural gap widens due to unequal access to smartphones and the internet.
Dependency on Technology: Outages or server issues can halt payments.

Could UPI Have Been Avoided?

While UPI has many benefits, the shift to a cashless economy has highlighted gaps in India’s social and economic fabric. Without adequate infrastructure or education about digital payments, certain sections of society are left out.

Global Perspective: Digital Payment vs. Cash Economy

Countries like Sweden and the UK are rapidly moving towards cashless economies, but they also ensure safety nets for marginalized communities. India’s rapid transition to digital payments needs to account for these vulnerable populations to ensure inclusivity.

Is There a Solution?

Digital Literacy Programs: Educating the poor about digital payments.
Government Initiatives: Introducing easy onboarding for UPI accounts with minimal documentation.
Donation QR Codes in Public Spaces: Encouraging public donations through accessible digital means.

Conclusion: Is UPI Truly Inclusive?

UPI has undeniably modernized India’s financial landscape, but it has also created unintended challenges for the most vulnerable. While its global expansion highlights India’s technological progress, ensuring digital inclusivity remains a critical challenge. Until beggars and marginalized communities are part of this digital wave, the success of UPI will remain incomplete.