Fintech Innovation Adoption in the Digital Payments Landscape Amidst the Pandemic: Empirical Evidence and Future Outlook

Abstract

This research evaluates the adoption of digital payment products launched by the National Payments Corporation of India using the Bass diffusion model. The study contributes to Fintech adoption literature and provides empirical and theoretical insights based on historical digital payments data. The findings show that imitation plays a significant role in adoption, with a slow initial adoption followed by acceleration. Among several payment products, UPI (Unified Payments Interface) stands out as the most successfully adopted product. The study highlights the relevance of the Bass diffusion model for estimating adoption rates and offers insights for international regions considering UPI-based payment systems. The results indicate varying adoption rates for different payment products and pronounced impact of imitations, with some experiencing slower adoption post-COVID-19 and others yet to achieve widespread adoption. The results aid business planning in estimating market potential, resource allocation, product development and strategic direction. Regulatory authorities can use this insight to enhance financial inclusion and promote lesser paper cash transactions which lead to socio-economic and business transformation.