Cash chaos bolsters India's digital payment system

Mumbai

THE chaos caused by India's ban on high-denomination rupee notes has provided a boost to a national cashless payment platform that has struggled to gain traction.

Usage of the government-backed Unified Payments Interface (UPI) has surged, with more than 250,000 transactions in the first week of December, close to November's total of 287,000, central bank data show, as some Indians seek to circumvent the cash shortage that followed the government's surprise graft-busting move on Nov 8.

Prime Minister Narendra Modi's action to invalidate old 500- and 1,000-rupee notes left India with about a fifth of its currency in circulation and caused a scramble for cash that has seen millions lining up at banks daily to deposit the notes or exchange them for new denominations. That's pushed more people toward the UPI, which has been slow to take off amid criticism that banks are not promoting the service e…