Abstract

This research paper takes stock of the legal battles and consumer protection regimes that shape it uniquely vis-a-vis emerging global regulatory paradigms to assess the prospects of India’s Unified Payments Interface (UPI) ecosystem. The rapid growth of payment systems in India, especially UPI (Unified Payment Interface) that started by making transactions as low as Re 1 possible, processed upwards of over 18 billion monthly in total between April - September period of this year; therefore needs solutions to balance out innovations with safeguards for consumer against misuse. The study examines three key questions: To what extent does the current legal architecture in India provide protection to consumers of digital payments? What can be learnt from recent developments in regulation in the United Kingdom, Singapore and the European Union? And how should Indian law develop to balance emerging conflicts between data protection, liability for fraud and regulation of payment systems? This study uses a doctrinal legal approach, reviewing primary sources such as the Payment and Settlement Systems Act 2007, the Digital Personal Data Protection Act 2023, RBI circulars and master directions, as well as international instruments like the United Kingdom’s APP Fraud Mandatory Reimbursement Framework and Singapore’s Shared Responsibility Framework. Much of the insight comes from specific opinions on wide gaps in India's consumer protection regime, such as the allocation of liability for authorised push payment fraud, the conflict between data protection based on consent and payments without friction, and a lack of enforcement despite rule-making. Supports strengthening remedies, including a statutory compensation system for low-value fraudulent transactions. These proposals aim to position Indian law at the forefront of digital payment governance while ensuring that consumer protection keeps pace with technological innovation.

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