Pay with your phone

Gene Bradford opens up his shop, West Main Auto Repair, each morning at 8 a.m in Lexington, Georgia. He’s lived in the small, close-knit community of Oglethorpe County for years now, and has come to know his customers’ personalities, mannerisms – and preferred forms of payment. 

Most pay with cash, credit cards or checks. They rarely use Apple Pay on their phones, or even seem to notice the sign that says they can.

The opposite is true across the world in Kolkata, India, where digital payments are the rule rather than the exception. In a busy part of the sprawling city, local street food vendor Sukhdev Kumar gets paid instantly with the scan of a QR code for his papri chaat, a popular snack he sells from a small cart. 

“Several customers demand online transactions,” Kumar said.

Their experiences reflect larger realities about online payments in their countries and the world. In India, the most populous nation and a rising economic power, the technology is used widely by large retailers, small shops and street merchants alike. But mass adoption has been much slower in the U.S.– even in Georgia, where Atlanta is a thriving financial technology hub. 

In 2022, India accounted for 46% of all global real-time payment transactions, with nearly 89.5 billion of them, according to a recent report by ACI Worldwide and GlobalData. The United States recorded only 1.8 billion. 

Many Americans still can’t adopt digital payment systems because of limited access to broadband and financial services like credit cards and bank accounts – which underscore broader societal inequities. Others, like Hazel Sanders of Hazel’s Hair Salon in Lexington, are skeptical about the technology or don’t know how to use it.

“I like the way it is. I like old school. I like cash and checks,” Sanders said. “I’ve heard of a lot of people getting taken advantage of by other payment systems … I just don’t trust them.”

Cashless payments thrive in India 

QR codes like the one atop Kumar’s cart have revolutionized Indian commerce, seamlessly linking millions of individuals through a real-time, cashless payment system known as Unified Payments Interface, or UPI.

UPI was developed almost a decade ago by the National Payments Corporation of India (NPCI) to allow transactions between people, merchants and banks. 

Dilip Asbe, managing director and CEO of NPCI, credited the country’s policymakers for its leading position in the global digital payments market. 

“Unless the country decides to adopt, it will not have an impact,” he said. 

Harish Prasad, the head of banking for India at Fidelity National Information Services Inc., said UPI has firmly entrenched itself as the predominant payment mode for millions of Indians and is growing every year.

Experts say support from the country’s policymakers and the nation’s efforts to improve broadband penetration are two reasons for UPI’s success.

While the United States ranks higher on broadband penetration, India is making progress. Indians also have a way to get around connectivity issues: UPI users can process money transfers offline by simply dialing “*99#.”

As UPI has caught on, it’s built upon itself and has become the norm.

Outside a park in Kolkata, a man selling fresh coconut water had a Google Pay sign on his bike. Nearby, a vegetable seller sitting on a blanket displayed a QR code near beans and peppers. And at a roadside pastry and snack shop in 24 Parganas, a QR code peeked out from behind the cakes.

In the U.S., barriers abound 

Experts point to a host of hurdles impeding the technology in the U.S.

One important barrier: government rules on matters like open banking and data privacy.

“Regulations within the U.S. versus regulations in more emerging marketplaces, tend to be a restrictor of adoption,” said Bob Trotter, associate director of the fintech certificate program at the University of Georgia.

Experts also cited serious systemic problems affecting consumers.

Currently, about 24 million Americans, most of them in rural areas, live in digital deserts with no access to broadband. In Georgia, there are 454,950 unserved addresses – about 90% of which are in rural areas, according to the 2022 Georgia Broadband Map. Most states define unserved as areas lacking even very low broadband speeds.

“Connectivity is a huge issue for us here in Georgia, especially having such a vast state from mountains to coastline to all of our farmland,” said Jessica Simmons, executive director for the Georgia Broadband Program.

To close the gap, the Biden administration has launched a $42.5 billion program to expand high-speed internet access nationally. The Georgia Technology Authority is in the planning phase for using more than $1.3 billion from the federal program to serve remaining unserved and underserved locations in Georgia.

The issue of “unbanked” Americans is also a complex and difficult problem to solve.

Adults without bank accounts are far less likely to use a payment app, especially when some only be accessed via a bank account. Even with apps that accept prepaid debit cards, unbanked consumers are less likely than banked consumers to use nonbank payment apps, citing inconvenience, distrust, financial illiteracy and high fees and service charges.

Another challenge: Consumer attitudes 

Besides these large systemic problems, Trotter notes that people’s attitudes about financial technology – including mistrust – remain significant obstacles to widespread adoption in the U.S. 

From Strickland’s produce stand to Bradford’s auto shop, cash is still king in Lexington, Georgia. A similar phenomenon can be seen throughout the U.S. in rural areas with older demographics.

Although he accepts Cash App and all forms of credit and debit cards, around 75 to 85% of Strickland’s customers pay with cash. Those who don’t are usually under 30 years old, he said.

Some of the mistrust around financial technology is rooted in fear of fraud. Historically, older adults have been targeted for financial fraud and exploitation. Many seniors also have a fraught history with financial institutions.

“If you're old enough to have gone through a run on a bank, or a Great Depression or watching financial institutions fail, you'll begin to question whether those institutions can be trustworthy,” Trotter said.

In India, however, financial technology has permeated every demographic.

Brijesh Tiwari, 51, hasn’t always accepted UPI. He owns a three-generation bookstore called Bookline on Park Street in Kolkata and had to learn more about the method from his son in order to feel comfortable using it. 

“In the beginning, it was a bit troublesome because of my inability to understand the UPI method but Gradually, I overcame the challenges,” he said. 

India’s celebrity restaurateur Riyaaz Amlani, CEO of Impresario Entertainment and Hospitality, said he anticipated a big learning curve for UPI but found it easier to use than he expected.

 It meant a welcome move away from the  “cumbersome and difficult” tasks of  handling cash and entering long, complicated credit card numbers.

As for Bradford, he’d love to see such benefits someday. So though his Apple Pay machine mostly collects dust, he plans to keep it on his counter in the hope that more consumers use it.

Khushi Malhotra, Supriyo Hazra and Ayush Gupta in India contributed to this article. As part of a new program at the University of Georgia, students in the Cox Institute's Journalism Writing Lab worked with students from India on joint story projects that link their two countries. The project is overseen by Laura Ungar, a reporter on the global health team at The Associated Press, and roving journalist Sujoy Dhar, founder of the Indian news agency India Blooms News Service, as well as Lori Johnston, director of the writing lab.