By Gowher Bhat
Kashmir is changing. In the bustling markets of Lal Chowk, the quiet corners of Anantnag, and the apple orchards of Sopore, a different kind of transaction is taking place. There was a time when people moved through these spaces with thick wallets in their pockets, careful with each note. Now, they carry phones. Payments happen with a few taps. A beep, a flash of light, and the money moves.
For many, it feels like progress. Cash shortages and long bank queues once made daily transactions inconvenient. Digital payments offer a simpler way. QR codes are everywhere — taped to shop windows, printed on cardboard, even scribbled on pieces of paper. The old tin cashboxes beneath the counters are still there, but they’re rarely opened now. This is Kashmir’s digital wallet revolution. And it didn’t happen overnight.
For years, cash was the preferred way. The sight of rupees exchanged across the counter, the shopkeeper running his thumb over the notes to check their authenticity — it was part of the transaction. People trusted what they could see and feel.
Then came the gradual introduction of mobile wallets. Platforms like Paytm, PhonePe, and Google Pay gained traction. At first, people hesitated. The concept of transferring money through a phone screen felt unfamiliar. “What if the money just disappears?” some would ask. Trust had to be built.
But slowly, the convenience began to outweigh the doubts. Vendors saw how they could complete sales without worrying about keeping change. Families found it easier to send money to loved ones, even across distant districts. Business owners appreciated the safety— no more carrying large sums of cash after a day’s work.
The real shift happened with the rise of the Unified Payments Interface (UPI). Unlike other mobile wallets that needed funds to be loaded beforehand, UPI linked directly to bank accounts. It was simple. Scan, pay, and receive — all within seconds. Even the smallest tea stalls embraced it. “I used to keep a cash drawer at my shop,” said Nazir, a grocery store owner in Baramulla. “Now, I just check my phone. The money comes straight in.”
Vendors like Nazir have stories to tell. Stories of how they no longer lose business because a customer doesn’t have exact change. Stories of how tourists, especially, prefer paying digitally. Even the artisans — the shawl weavers, carpet makers, and walnut wood carvers— now have a presence on digital platforms. They sell their crafts across India, sometimes even overseas, accepting payments with ease.
But it’s not just the merchants. In the remote villages of Kupwara and Gurez, where bank branches are sparse and distances are long, UPI has brought banking to people’s fingertips. Farmers who once traveled miles to deposit or withdraw money now receive payments directly in their accounts. “I used to spend an entire day traveling just to collect money for my apples,” said Bashir Ahmad, an orchard owner. “Now, I get a message on my phone. Payment received.”
Even during the harsh winters, when snow blankets the Valley and movement becomes difficult, the cashless economy remains active. Mobile phones, charged and ready, serve as virtual wallets. For many, it’s a lifeline.
For the younger generation, digital payments have become second nature. College students pay their tuition fees online. Friends split bills using mobile apps. E-commerce is flourishing, with small businesses in Srinagar running online stores and accepting payments from across the country.
Even traditional services are adapting. Houseboat owners on Dal Lake, who once relied heavily on cash, now display QR codes for easy payments. Guests prefer the convenience, and owners appreciate the security. “It’s better this way,” said one houseboat owner. “No bundles of cash. No worries about change. Just a beep, and it’s done.”
Yet, trust remains a complicated thing. For every successful digital transaction, there’s a story of fraud. Phishing messages, fake payment links, and disappearing funds have made people cautious. Some shopkeepers demand to see the confirmation screen before handing over goods. Others rely on their children or younger relatives to help navigate the apps. “I’ve heard of people losing their money,” said Faisal, who runs a small electronics store. “That’s why I check everything twice. Once it’s in my account, then I let the customer go.”
Banks and fintech companies are working to address these fears. Financial literacy programs are more common. Advertisements on local radio stations explain how to spot scams. Workshops teach people — especially the elderly — how to use digital wallets safely.
Yet, for some, the comfort of cash remains. Elders often hold onto small bundles of notes, tucked inside woolen shawls or hidden in old wooden drawers. They view the phone screens with suspicion. The weight of money in hand is still reassuring. “My son tells me I should use UPI,” said Ghulam Nabi, a retired teacher. “But I like my money where I can see it. Maybe one day I’ll change.”
Despite the skepticism, the road to a cashless Kashmir seems inevitable. Banks are expanding their digital services. Mobile internet is more accessible than before. Younger generations, raised with smartphones in hand, are already fully immersed in the digital economy. Government initiatives supporting financial inclusion are also making a difference. Women in rural areas, once excluded from formal banking, now receive payments for their handicrafts directly to their accounts. Daily wage laborers get paid digitally, avoiding the need to stand in lines at banks. “I never had a bank account before,” said Mehak, a seamstress from Bandipora. “Now, I have one. I get my payments on my phone. It feels like I have control.”
E-commerce is also on the rise. Young entrepreneurs in Srinagar run online stores, selling traditional Kashmiri clothing, spices, and handicrafts. With digital wallets, they reach customers far beyond the Valley. Some even export their products internationally.
While the shift towards a cashless Kashmir offers numerous advantages, it’s important to consider the potential drawbacks, as pointed out by various reputable sources. Not everyone has access to the necessary digital tools, such as smartphones and bank accounts. This digital divide leaves some people behind, particularly in rural areas. As reported by The Times of India, individuals without access to digital payment systems are at a disadvantage, widening existing socioeconomic gaps. According to a 2021 study by the Reserve Bank of India (RBI), rural areas still lag in mobile phone and internet penetration, limiting the benefits of digital payments for these populations.
The reliance on digital platforms for transactions increases the risk of cyber threats, including hacking and fraud. Instances of disappearing funds, phishing scams, and fake payment links are becoming more common. The Hindu mentions that these risks have led many people to hesitate before fully embracing digital payments, particularly when trust in these platforms has not been fully established. A report by NASSCOM highlighted that over 45% of digital payment users have encountered fraud attempts at some point.
Reliable internet connectivity is a prerequisite for seamless digital transactions. However, certain areas of Kashmir still experience unstable internet access, as noted by The Times of India. Without robust infrastructure, the digital economy cannot function optimally, hindering the growth of cashless transactions in remote areas. According to the Telecom Regulatory Authority of India (TRAI), Kashmir’s internet penetration and speed lag behind the national average, which could delay the full transition to digital payments.
The informal sector, which relies heavily on cash transactions, faces difficulties adapting to digital payments. As The Times of India points out, workers in small industries continue to operate in cash, which limits the potential of cashless initiatives. A World Bank report also states that approximately 80% of the workforce in rural regions is part of the informal sector, underscoring the challenges of full digital integration.
A fully cashless Kashmir may still be a few years away. Network connectivity remains unreliable in some areas. Many still feel safer with cash. And the emotional connection to physical money lingers. But the signs are clear. The phone screens lighting up with payment notifications, the vendors proudly displaying their QR codes, the farmers receiving instant payments — they are all part of this shift.
- Gowher Bhat is a Pulwama based writer and skilled English language instructor. Views expressed in this article are author’s own and don’t necessarily reflect KO’s editorial policy.
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