Understanding the drivers of digital payment adoption: A regression- based investigation into government Initiatives

Abstract

This research paper scrutinizes the intricate dynamics shaping the adoption of digital payment methods, with a particular emphasis on the role of government initiatives. Employing a regression- based analytical approach, this study identifies and evaluates various factors influencing the uptake of digital payment systems. The findings underscore the significant impact of Economic Factors, including income levels, employment status, and economic stability, on the adoption of digital payment mechanisms. Moreover, when it comes to the consumers, Technological Factors integrating Internet Penetration, the percentage of the population using a smartphone, and the percentage of the population with access to broadband or digital infrastructure also become driving forces. This also includes consumer behavior and preferences with Sub-criteria of convenience, security and trust, without which many people would not use digital payments. In contrast, Regulatory and Policy Factors do not affect the dependent variable and while being vital for the overall system, they do not impact market expansion. Finally, Business and Industry Factors are also influential, encompassing the merchant acceptance, payment system integration, and incentive schemes. The findings of this research present important implications for policymakers, organizations and others and could assist them in developing strategies through which digital payment could be progressively adopted to integrate economies from within.