Factors Shaping the Adoption of UPI-Enabled Mobile Payment Systems: An Empirical Investigation through the UTAUT2 Lens with Performance Risk Moderation

Abstract

India's push toward a cashless economy has placed the Unified Payments Interface (UPI) at the very centre of everyday financial life yet the behavioural story behind why millions of citizens choose to keep using, or walking away from, UPI-based Mobile Payment Systems (MPS) remains only partially told. Drawing on the Unified Theory of Acceptance and Use of Technology 2 (UTAUT2), this study builds and tests a model that treats Performance Risk not merely as a background nuisance but as an active boundary condition shaping whether positive intentions actually translate into real-world usage. Structured questionnaires were administered to 686 active UPI users across India between November 2025 and February 2026, and the data were analysed through Partial Least Squares Structural Equation Modelling (PLS-SEM). Every hypothesised path held up: Performance Expectancy, Effort Expectancy, Social Influence, Facilitating Conditions, Hedonic Motivation and Habit each contributed meaningfully to Behavioural Intention, which went on to strongly predict Usage Behaviour. Crucially, Performance Risk weakened the intention-to-usage link in a statistically and practically significant way—a finding with direct implications for how platforms, regulators and marketers should think about consumer trust. The model accounts for roughly 41% of variance in intentions and 30% in actual usage, both classified as substantial.