Did you overpay or overspend? The hidden cost of convenience

Digital payments are changing our relationship with money, leading us to prioritise speed over mindful spending

- Shephali Bhatt

Ever had the fear of adding an extra zero while making an online payment—at a store, while jumping out of a cab, or at any moment when the ease of "scan to pay" or "tap to pay" collides with our natural tendency to rush? Mumbai-based financial markets professional Baibhav Mishra, 28, lived through that nightmare last year. While scanning a QR code on his laptop to pay for an order on a B2B marketplace via UPI (Unified Payments Interface), "I accidentally entered ₹50,000 instead of ₹5,000," he recalls. Mishra says the marketplace had no recourse for overpaying and advised him to reach out to the seller directly—but nothing came of it. The worst part? "I never even got the item I ordered."

We’ve been trying to come to terms with the fact that digital payment tools—debit and credit cards, mobile banking apps, e-wallets and payment apps powered by UPI—lead us to overspend unintentionally.

In January 2024, the Indraprastha Institute of Information Technology (IIIT), Delhi, published a study titled From Cash to Cashless, revealing that 74.2% of participants spent more due to UPI, while only 7% spent less. But, we must also confront the reality that our reliance on digital transactions might be causing us to overspend erroneously too.

While reporting this story, Lounge uncovered various overpayment blunders, often driven by the mechanics of online payments. These include scanning a QR code to pay via UPI-enabled apps (PhonePe, Google Pay or Paytm) but still needing to type the amount, or tapping a debit/credit card without noticing the inflated total entered accidentally by the vendor, or simply making a mistake.

One person shared how he mistakenly sent ₹30,000 to his cable guy instead of his friend-in-need through his mobile banking app. Another almost entered their six-digit UPI PIN as the amount to be paid at a store.