Unified Payments System (UPI) has transformed digital payments in India. Today, UPI payment facility is available at shopping malls and vegetable shops. People are not only buying everyday goods through UPI, they are also paying bills for expensive home appliances, expensive gadgets and designer clothes. But it is also being said that this will increase wasteful expenditure.
Its role is very important in the journey of digitizing India’s payment system and reducing the use of cash. But, this facility has a negative side too. News agency IANS quoted experts as saying that people are getting addicted to unnecessary expenditure due to UPI. They are buying even those things which they do not actually need at that time.
Why is wasteful expenditure increasing due to UPI?
The biggest reason for the increase in purchases through UPI/QR code is smartphones. Today, a large population of the country has access to smartphones and data. They pay for anything through smartphones in a jiffy. This is also becoming the reason for wasteful expenditure.
A recent survey by IIT Delhi shows that about 74 percent of people are spending more than necessary due to UPI and other digital payment options. Actually, it is much easier to make payments through digital mode than cash. If there is a problem of change in cash or you do not have that much money at that time, then you stop shopping.
But, there is no problem with UPI or any other digital payment. Consider the money you have in your bank account as if it is in your smartphone. You can even spend more than your bank account using means like credit card. You can also borrow money instantly from friends or relatives.
What are industry experts saying?
Prabhu Ram, head of the Industry Intelligence Group at market intelligence firm CMR, told news agency IANS, “There is a high possibility of wasteful expenditure due to such convenience, as it is a digital mode. It does not feel like paying cash in hand, you do not know how much money you are spending.”
The latest data from the National Payments Corporation of India (NPCI) showed that the number of UPI transactions reached 1,330 crore in April. This is an increase of 50 percent on an annual basis. Last year, UPI transactions grew by almost 60 percent to a record 11,768 crore.
According to experts, consumer spending is increasing in India. Now people are spending a lot of money on cars, smartphones, TVs and other items. This is boosting the country’s economic growth. However, it is also being seen that due to UPI, people are spending more than necessary on some high-priced items. And this trend is increasing continuously.
