Bengaluru, the country’s IT capital, which was once an example of digital payments, is now getting filled with posters of ‘No UPI, Only Cash’. Small shopkeepers and street vendors have started refusing to accept UPI payments, due to notices from the GST department and the complexities associated with digital transactions.
What is the reason?
Hesitancy about UPI payments is now clearly visible among small traders across the country. The biggest reason for this is the fear of GST notice. In many cases, it has been seen that despite having a turnover of less than ₹ 40 lakh, notices have been sent to traders only on the basis of UPI transactions, which has increased their apprehension.
On the other hand, lack of technical understanding is also a big reason – many shopkeepers do not understand the complexities of the UPI system, so they consider cash to be safer and simpler. Moreover, the lack of immediate cash transfer during digital payments hinders their daily needs, as the entire business of street vendors and small shopkeepers depends on instant cash. Some payment apps deduct a part of the transaction amount as processing fees, due to which vendors do not get full payment.
The recent rumour that the government is going to impose tax on UPI transactions above ₹2000 also complicated the situation further. Although this rumour was later debunked, its effect was that customers have also started preferring cash payments. All these reasons together have created an environment in which the reliability of digital payments is being questioned, especially among those whose livelihood is completely dependent on direct and daily earnings.
Effect seen in Delhi too
Many fruit vendors in the markets of North-East Delhi also refused to accept UPI. An elderly vendor said, “We do not know so much technology.” Another said that the company does not pay on time, hence cash is better.