Digital Payment Diffusion, Working Capital Asynchrony, and Infrastructure Friction in Grassroots Micro-retail: Empirical Evidence from a Semi-urban Industrial Cluster in Central India

Abstract

Aims: The rapid digitisation of retail settlements through real-time payment (RTP) infrastructures such as the Unified Payments Interface (UPI) is transforming micro-enterprises across developing economies. However, informal micro-merchants in semi-urban industrial nodes often experience structural friction between front-end digital adoption and back-end cash settlement imperatives. This study examines point-of-sale digital adoption patterns, operational infrastructure bottlenecks, and working capital liquidity friction among informal micro-vendors. Study Design: Cross-sectional empirical survey design. Place and Duration of Study: Four commercial market corridors (Kosabadi, Transport Nagar, Niharika, Old Bus Stand) in Korba District, Chhattisgarh, India, from March to May 2026. Methodology: Primary data were gathered from N = 200 informal micro-merchants using a structured, bilingual instrument administered face-to-face. Analytical techniques included non-parametric Likert diagnostics, Friedman's ANOVA with post-hoc Wilcoxon signed-rank tests, Pearson's Chi-Square (χ²), Fisher's exact test, and bivariate binary logistic regression. Results: Point-of-sale digital adoption reached 81.5% (n = 163). Digital acceptance exhibited a statistically significant positive association with reported customer footfall expansion (χ²(1, N = 200) = 18.461, p < .001, Cramer's V = 0.304; Fisher's Exact Test p < .001; OR = 4.46, 95% CI [1.98, 10.05], p < .001). However, micro-merchants faced working capital liquidity mismatches because upstream wholesale inventory replenishment at Mandis remains strictly cash-dependent. Cellular network congestion during evening windows (Mean = 4.42 ± 0.68, Median = 5.0) and payment verification uncertainty among static QR operators (Mean = 3.85 ± 0.89, Median = 4.0) imposed substantial operational friction. Conclusion: Front-end retail digitisation without matching upstream wholesale integration creates operational vulnerabilities and working capital friction. Sustainable inclusion requires wholesale digital clearing desks, subsidised verification audio hardware, and telecommunication upgrades.