International Journal of Social Science & Economic Research
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Title:
UPI and the Informal Economy: A State-Level Analysis of Digital Payment Adoption and Informal Enterprise Performance in India

Authors:
Vansh Gupta

Journal: International Journal of Social Science and Economic Research (IJSSER)
ISSN: 2455-8834
Volume: 11
Issue: 9
Publication Date: September 2026
DOI: 10.46609/IJSSER.2026.v11i09.045

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Vansh Gupta
The Modern School, New Delhi, India

MLA 8
Gupta, Vansh. "UPI and the Informal Economy: A State-Level Analysis of Digital Payment Adoption and Informal Enterprise Performance in India." Int. j. of Social Science and Economic Research, vol. 11, no. 9, Sept. 2026, pp. 5203-5225, doi.org/10.46609/IJSSER.2026.v11i09.045. Accessed Sept. 2026.
APA 6
Gupta, V. (2026, September). UPI and the Informal Economy: A State-Level Analysis of Digital Payment Adoption and Informal Enterprise Performance in India. Int. j. of Social Science and Economic Research, 11(9), 5203-5225. Retrieved from https://doi.org/10.46609/IJSSER.2026.v11i09.045
Chicago
Gupta, Vansh. "UPI and the Informal Economy: A State-Level Analysis of Digital Payment Adoption and Informal Enterprise Performance in India." Int. j. of Social Science and Economic Research 11, no. 9 (September 2026), 5203-5225. Accessed September, 2026. https://doi.org/10.46609/IJSSER.2026.v11i09.045.

References

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ABSTRACT:
This paper examines the relationship between digital payment adoption and production-side outcomes among informal enterprises in India. Using state-level cross-sectional data for 37 States and Union Territories, Ordinary Least Squares (OLS) regressions estimate the association between digital payment intensity, digital payment growth, and four measures of enterprise performance: receipts per establishment, receipts per worker, gross value added (GVA) per establishment, and GVA per worker. The results indicate that higher digital payment intensity is associated with lower receipts and GVA per establishment but exhibits no statistically significant relationship with worker-level outcomes. In contrast, faster growth in digital payment adoption is positively associated with GVA per establishment but negatively associated with GVA per worker. Overall, the findings suggest that digital payment adoption is not consistently associated with improved production-side outcomes. Rather, digital payments appear to function as an enabling technology whose benefits depend on complementary improvements in enterprise capabilities, market access, and the broader business environment.

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