From Coins to QR Codes: How UPI Changed Everyday Transactions

The Hindu

17-07-2025

Published : Jul 17, 2025 08:13 IST - 10 MINS READ
I can't remember when exactly I started using the Unified Payments Interface (UPI), but it has been a while. I think it was pre-COVID—I had to make a payment to a friend and he suggested I download GPay. I was hesitant and wary at first, as we tend to be with new things, especially when it involves one's bank account, not that there is very much in it, but still.
When I sent my first email in 1998, little did I know that it would mark the end of writing letters. Often the dramatic turning points in our lives are not marked in red. We might remember birthdays and death anniversaries, but technological changes have a way of slipping into our lives quietly, like a neighbourhood cat that one day likes you enough to adopt you. From here on, your life will never be the same, except that you don't know it yet. I must have posted one last letter to someone but it's not something recorded in my memory. I wrote a letter, then email entered my life, and I moved forward.
Similarly, one innocuous afternoon a skinny lad came and affixed a cable to my parents' Bush Baron black & white TV. I stopped watching Doordarshan and switched to watching The Wonder Years and MTV. I think it was 1994. I never went back to DD. Another instance I can think of is dictionaries. For quick reference we started using online dictionaries, especially while writing; I can't recall the last time I checked a word in the Concise Oxford.
I mention this because once in March and twice in April, the National Payments Corporation of India, the body that is responsible for the smooth functioning of UPI, experienced 'intermittent technical issues'. It was a bit like the 'Sorry for the Interruption' sign on DD, except that that sign was a frequent fixture on our screen in the 1980s—we were used to it; the UPI is so reliable that we transitioned seamlessly and take it for granted. Money has ceased to be a tactile thing.
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Everywhere I went—to the supermarket, the kirana store, the cigarette shop—people were desperately trying to make payments but were unable to. The new bar of soap was abandoned, left to fend for itself on the shop counter. That's how dependent we've become on UPI. The UPI being down was a national issue; it trended on X and broadsheets ran editorials.
The wallet-keys-watch holy trinity—something we always double checked when leaving home—has long ceased to be holy. Most of us have stopped using cash; carrying a debit card is a hassle, for the debit card needs a wallet, and the wallet's place in one's pocket has been usurped by the phone.
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UPI is the world's most popular alternative payment method, way ahead of others like Skrill (100+countries), Brazil's Pix and China's Alipay.
One of the reasons why UPI became so popular in India is because cash transactions were never easy-peasy. One started the day with a challenge: how will I break a note. If the note was of a high denomination, one was forced to buy things one didn't really need, just to make the process of breaking a note more attractive for the shopkeeper. Change was hoarded like gold.
There was another problem: if you were not careful, your fellow Indian would try and palm off a tattered note. Like if the streetlight was not working at the spot where the auto guy dropped you off at night, he might slip in a torn note, or one that was taped together. You couldn't afford to let your guard down because everybody was looking to get rid of their dodgy notes. The law says that all notes, no matter what the condition, are legal tender. That's not the way it worked on the ground. Funny, how a poor country can be so concerned about the aesthetics of currency—how a note looks decides its fate, a bit like how brides are chosen in arranged marriages.
One also had to be alert about counting the notes—the payee would give you less money than was actually due. If you caught him out, he'd pass it off as a mistake. My first time in England, I made the mistake of counting the money that the cabbie had returned to me. I did this in front of him, which, I was later told, was a very rude thing to do. He was offended. There, the levels of trust are so high that counting is taken as an insult—are you trying to say that I'd cheat you? Where do you come from?
A tradition that was passed down from generation to generation was to hold the note up to light to check for the watermark. We did it out of reflexive habit and no one took offence. Fake currency was a thing, and doing this just showed that you were a thoroughbred Indian insider. It got you streetcred.
The act/ process of obtaining the cash was tedious in itself. One had to fill out a withdrawal form or a self-cheque, stand in a queue, before being granted an audience with the cashier, a dreaded, grumpy, frog-like figure with zero princely potential. He would squint at you from behind the counter and nine times out of ten declare that the signature did not match. He would make you do another signature, then scrutinise it like a watchmaker. I always got the sense that the cashier behaved like he owned all the money in the bank; he was not giving you what was rightfully yours, but doing you a favour.
In recent times, the cashier's high point came during demonetisation, except that by now he worked in an air-conditioned private bank and had access to a note-counting machine. The skill of licking your finger before counting notes had been made redundant.
'Nowadays, cash is used by two categories of people: the really poor who have no access to a basic smartphone and a bank account, and the really wealthy who still hide their black money in basements and false ceilings. '
Cash came with another problem—of storing it in the house, and how to carry it safely while travelling. A stock of emergency cash would generally be hidden under a pile of clothes in the Godrej almirah. It was an open secret known to burglars. When travelling long-distance, my father would wear a vest with an inside pocket where the notes were concealed, a kind of secret portable locker, fused into one's body.
Nowadays, cash is used by two categories of people: the really poor who have no access to a basic smartphone and a bank account, and the really wealthy who still hide their black money in basements and false ceilings. Cash enjoys an under-the-table existence in most property deals, which are conducted partly in white and partly in black. In bars and clubs, you can still find rich brats pulling crisp bills from wads of cash. Daddy must be a real estate dealer.
Which brings us to the handmaiden of currency notes: coins. The memories of coinage are like the rings on a spliced tree trunk: you can tell a person's age from the coins she remembers.
Coins are made of metal and alloys, each with its own fascinating history. The 10 paisa coin, for instance, went through a gamut of materials—cupronickel (1957-67), nickel-brass (1968-1971), aluminium (1971-1993) and stainless steel (1988-1998). The metal factor spawned its own artificial man-made scarcity. If the value of metal was more than the coin's denomination, those coins would illegally vanish from the market. They were melted down and sold as what they were originally: base metal.
The beautiful thing about coins is that people collect coins and they have value. The current value of a discontinued coin is at times more than its original denomination, depending on age and rarity (those from before 1980 are more valuable); mint mark (coins from the Bombay and Calcutta mints are more sought after); and condition (whether worn or uncirculated). Commemorative coins with special designs, issued to mark specific events, can be worth a lot more.
Or take the 25 paisa coin of 1984. The coin was minted in Bombay, Calcutta and Hyderabad, but in this case the Hyderabad one is the most valuable, going at a rate of Rs. 1,000-5,000, while the Bombay and Calcutta ones are valued at Rs.50 and Rs.100. A range of numismatic apps, from Coinbazzar to even Flipkart, cater to the coin collector.
I still find old coins in my house, in unopened drawers, unspent leftovers from childhood piggybanks made of clay—the great Indian gullak. Coins also enjoyed a parallel life. Passengers on a train would fling coins into rivers for good luck. Most coins didn't make the journey to the riverbed, landing on the railway overbridge itself. Children from nearby shanties would collect the coins and put them back into circulation.
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When MTV launched in 1981, the first ever music video they played was The Buggles' 'Video Killed the Radio Star'. The coming of the ATM killed the cashier, punctured his pomposity. No longer was he a star sitting on a high horse in a stifling cubicle, with a slow-whir fan for company.
The first ATM I used was when I arrived as a student at Oxford, in 1998. I was petrified of the machine, took too long to press the right buttons, and, sure enough, the machine swallowed up my card. It was night and the bank was shut. I pictured it going down a mysterious chute, before vanishing into an underground molten black hole. When I went back the next morning the recovery process turned out to be quite simple. An employee opened a lock from inside the bank, put his hand in and fished it out. He demystified the ATM.
The ATM made life easier, both for us and the thieves. The bank robber didn't now require the skill or gumption to break into a bank safe after dinner or do a daring hold-up after breakfast. He just had to detach the ATM machine, bung it in a getaway vehicle and drive away into the sunset.
Which is why, at least in India, ATMs come with security guards. For the guard, the ATM kiosk is his office and bedroom. The more ambitious use it as a library to work in, a cramped study room of sorts, where you can read, make notes, and prepare for competitive exams.
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To be fair, UPI has not killed cash, coins, cashiers or the ATM. The RBI continues to issue coins in the denominations of 50 paise, 1, 2, 5, 10 and 20 rupees. But, at least for the urban middle class, actual currency has become a bit like linear TV—it's not dead, yet, but on its way out. Most have switched to smart televisions.
While UPI has not killed cash off completely, it has killed the toffee economy. Back in the day, the shopkeeper would return some amount of the balance due to the customer in toffees. The reason given was the lack of requisite change. A small bakery near my house expanded into a full-blown eating joint by following the five-toffee principle. This unwritten rule states that in every transaction return a minimum of five rupees (sometimes even 10) in toffees. This led to many arguments with tempers soaring, before the hapless customer surrendered in resignation. The second rule was that toffee was a one-way currency—the shopkeeper was allowed to use it as such but not the customer. You couldn't come back the next day, buy a loaf of bread and pay part of the amount in toffee.
I must say that I sort of miss those orange Parle toffees that could fill several jars, even though I was somewhat pleased to hear that the bakery recently burned down due to a short circuit. It will take many, many toffees to rebuild it.
Meanwhile, start searching for that lost 5 paisa coin in your house. It might just make you a millionaire.
The writer is the author of The Butterfly Generation: A Personal Journey into the Passions and Follies of India's Technicolour Youth, and the editor of House Spirit: Drinking in India.