Subhash Singh, a vegetable seller in New Delhi’s Lajpat Nagar, is not a user of the Unified Payment Interface (UPI), yet a chunk of his daily earnings happen on the platform. He has been parking his cart in front of a grocery store for about two years now, and in the process, has befriended the store owner who accepts UPI payments on his behalf.
As the coronavirus pandemic hit India, Singh says, more people have started paying digitally through UPI. That was when he realised that he had to find a way to accept these payments. But, there was a problem: Singh does not have the digital literacy to operate a smartphone because of which he has never purchased a smartphone and more importantly, he does not have a bank account – two key requisites to join the UPI ecosystem right now. While the Reserve Bank of India has said that it will launch a version of UPI called UPI123Pay for feature phones without internet access, having a bank account is still necessary to use the service. “My family depends on my daily earnings. Whatever I earn today, we end up finishing a large part of it today and we don’t have any savings. So there has never been a need to open a bank account,” Singh said when asked why he did not have a bank account. Singh is not alone. According to a 2018 World Bank report, around 190 million Indians did not have a bank account.
Realising Singh’s problems, Rajendra Chaudhary, who owns the grocery store right behind where Singh parks his vegetable cart in Lajpat Nagar’s H block, offered to take UPI payments on his behalf. He claims that there is nothing in it for him, and he is helping Singh because the two of them have become friends. “I saw he did not have any equipment to use UPI and because his cart was parked in front of my store all the time, I offered to help him after he asked me about UPI when several of his customers insisted on paying online,” Chaudhary said.
UPI recently crossed the $1-trillion mark in transaction values for the financial year 2021-22 after the payments system crossed 5 billion transactions in a month for the first time in March, marking a major landmark for the flagship payments architecture which has gained significant momentum in adaptation in the last few years.
The payments system, developed and managed by the National Payments Corporation of India, commands a lion’s share in the volume of total retail payments made in the country. According to a Macquarie Securities report, in FY22, around 60 per cent of the volume of India’s retail payments were done through UPI. The platform is also expected to have played a key role in increasing the adoption of digital payments in the country. The Reserve Bank of India’s (RBI’s) digital payments index (DPI) for September 2021 stood at 304.06 compared to 270.59 in March 2021.
UPI is used by more than 500 million users, but even as a percentage of the population remains to be onboarded to the platform, it is fueling unlikely friendships on the streets — between merchants who currently use UPI and those who don’t. Singh says that on average, he earns around Rs 600 every day, and more than half of that – close to Rs 400 – comes to him via UPI. At the end of each day, he sits down with Chaudhary, the store owner, who maintains a log book of the payments he receives on UPI on behalf of Singh and gives him the amount for each day in cash. This has made Singh and Chaudhary close friends, he says.
“I was even invited to his daughter’s wedding last year. That is what happens when you can trust someone with your money, and in my case, a majority of my earnings sit with Rajendra (Chaudhary) throughout the day,” Singh told The Indian Express.
Rinku Yadav, a hawker in Lajpat Nagar’s Central Market who sells socks and handkerchiefs, has befriended Saurav Aggarwal, a competitor who sells the same items, for accepting UPI payments on behalf of him. He says that despite the two of them being rivals on the street, Aggarwal has agreed to help him with digital payments given the sheer number of people who prefer paying through UPI. Like Singh, the vegetable vendor, Yadav too doesn’t own a smartphone or have a bank account. “A majority of my customers prefer paying through UPI, it has been like that for over two years now. I don’t think people are carrying a lot of cash these days even when they visit markets,” Yadav told The Indian Express.
“Even though Saurav (Aggarwal) sells the same things as me, he recognises that if I don’t accept digital payments, I will not make much money in a day which is why he takes payments on my behalf. We may be rivals on the ground, but UPI has made us good friends,” he added.