Evolution of Cashless and Credit-Based Payments in India and Their Implications for Young Consumers: A Review-Based Study

The rapid advancement of financial technology has transformed India’s payment ecosystem through the widespread adoption of cashless and credit-based payment systems. Digital modes such as Unified Payments Interface (UPI), cards, digital wallets, and emerging credit instruments have significantly influenced transaction behaviour, particularly among young consumers. This review-based study examines the evolution of cashless and credit-based payments in India and their implications for young consumers using secondary data from academic literature, regulatory reports, and industry publications. The study identifies convenience, technological accessibility, government initiatives, and social influence as key drivers of adoption. Findings reveal that young consumers are early adopters due to their digital literacy and lifestyle preferences. While cashless payments improve transactional efficiency and financial inclusion, increased reliance on credit-based digital payments reduces the psychological impact of spending, encouraging impulsive consumption and raising financial risk. The study concludes that sustainable adoption of digital payment systems requires responsible usage, enhanced financial literacy, and effective regulatory oversight to ensure balanced financial behaviour among young consumers.