UPI Increased Informal Workers' Visibility but Not Their Security

Digital payments in India expanded rapidly after the policy push for financial inclusion embodied in the JAM trinity: Pradhan Mantri Jan Dhan Yojana, Aadhaar, and mobile telephony. The public‑private payment interface that emerged around Unified Payments Interface (UPI) lowered transaction costs and extended instant settlement to micro‑merchants and casual workers. The underlying legal rail is the Payment and Settlement Systems Act, 2007. Parallel to these technological advances, labour policy recognised a distinct category of platform and gig work in the Code on Social Security, 2020, which envisages a dedicated social security fund for such workers. Implementation of those provisions has been slow, leaving a gap between entitlement on paper and delivery in practice.

India’s workforce remains heavily informal. NCERT and other surveys estimate around 89 per cent of workers in informal employment. Traditional social insurance schemes like EPFO and ESIC have limited reach in this segment. State efforts, for example, some early state-level gig‑worker laws, have tried to fill the vacuum. But the deeper issue is political and institutional: digital access and payments are operational fixes that do not, on their own, create enforceable labour rights or predictable incomes.