How do Digital Payment Systems Affect Consumer Behavior and Banking Services?

Author(s)	Ms. Aarya Agrawal
Country	India
Abstract	This research focuses on the changing aspects of consumer behavior and payment services in India, particularly due to digital payments and digitalization. With the rapidity of technology adoption specifically around UPI, mobile wallets, and contactless payments especially after COVID-19, many consumers, instead of cash, have favoured speed, convenience and cashless transactions. These digital services have impacted consumer behaviour including spending behaviour, created a new level of financial inclusion, and influenced traditional banks to adopt digitization. The research utilizes secondary data sources to analyse trends in digital payment usage, banking innovation, and issues and challenges around key considerations of cybersecurity, data privacy, and the digital divide. Using existing case studies, the research looks at the evolving establishing landscapes of digitalization and further outlines possible future trends involving AI, blockchain, and central bank digital currencies (CBDC). In conclusion, it was found that while the benefits of digital payments and or digitalization were obvious, the ethical, infrastructural, and regulatory implications needed more diligence to grow financial systems to all digitally and securely.
Published In	Volume 7, Issue 5, September-October 2025
Published On	2025-10-09
DOI	https://doi.org/10.36948/ijfmr.2025.v07i05.55138

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