Determinants of Digital Payment Adoption in India: Fintech Innovation, Fraud Risk Management, and User Convenience with Regulatory Framework as a Moderator
Sunil S. 
Devarajappa S.
Abstract
While digital payments have surged in India, the role of regulatory frameworks in balancing technological innovation and security remains under-explored. Drawing on Institutional Theory and the Technology Acceptance Model, this study evaluates the effects of fintech innovation, fraud risk management, and user convenience on digital payment adoption, with regulatory frameworks as a moderator. Adopting a positivist philosophy and deductive approach, data were collected from 324 active digital payment users in India. These data were analysed using Structural Equation Modelling. Findings indicate that fintech innovation is the strongest predictor of adoption, followed by fraud risk management, while user convenience also exerts a significant influence on digital payment adoption. Regulatory frameworks strengthen the relationship between security perceptions and adoption quite significantly, while negatively moderating the relationship between fintech innovation and adoption, indicating a constraining effect of regulation on innovation-driven adoption. The findings highlight the need for smart regulatory approaches and regulatory sandboxes to balance innovation and consumer protection in India’s fintech ecosystem.
Keywords: Digital Payment Adoption, Fintech Innovation, Fraud Risk Management, User Convenience, Regulatory Framework, India
Volume 17, Issue 1
June 30, 2026
Pages: 66-92
DOI: http://doi.org/10.4038/cbj.v17i1.223
_______________________________________________________________________________________________________
Suggested citation:
Sunil, S., & Devarajappa, S. (2026). Determinants of Digital Payment Adoption in India: Fintech Innovation, Fraud Risk Management, and User Convenience with Regulatory Framework as a Moderator. Colombo Business Journal, 17(1), 66–92. http://doi.org/10.4038/cbj.v17i1.223
______________________________________________________________________________________________________
Sunil S.
Department of Studies and Research in Commerce, Tumkur University, Tumakuru, India
________________________________________________________________________________________________________
Devarajappa S.
School of Business Studies, Central University of Karnataka, Kalaburagi, India