Digital payment adoption, business transition, and socioeconomic upliftment among street vendors: evidence from Delhi-NCR

Highlights

• Street vendors in the Delhi NCR region are embracing digital payments, driving local business expansion.
• Digital innovation enables global trade despite low literacy and weak infrastructure.
• Survey finds strong positive ties among payments, supply chains and global commerce.
• Digital adoption boosts resilience, efficiency and inclusion for unorganised suppliers.
• The change uplifts informal economies, linking local progress to global growth.

1 Introduction

Before the diffusion of digital and e-commerce technologies, street vendors had minimal integration into multinational company (MNC) supply chains, reflecting structural constraints related to limited technological access and innovation capacity (Untaru and Han, 2021). After the COVID-19 pandemic situation forced them to use digital payments to connect with the World, this study is going to analyse the digital inclusive finance (Liu et al., 2022; Wang et al., 2024), facilitates the growth of their income level in link to e-commerce promotion, and infrastructure development and economic development for both sellers and buyers in rural regional to urban smart cities (Shihe and Junfu, 2025) sustainable development and internationally to eradicate poverty and boosting employment opportunities (Han and Li, 2021). Following the strategic orientation towards digitalisation (Ghouse et al., 2022, 2021; Pascucci et al., 2023), which changes the consumption behaviour of rational consumers (Gupta and Singh, 2020), responsibility and habits indirectly influence consumer loyalty (Ghazali et al., 2016). In the digital era, smart city innovation (Khobragade et al., 2025) and MNC clusters of street vendors in India promote international connectivity (Chen et al., 2025). The World Bank 2022 report estimated that 1.7 billion adults with a large population are using cash for transactions, in India but globally, they have no access to banking services. For instance, a pilot study says the use of digital payment through (Shao et al., 2019), mobile devices (Balapour et al., 2020), increases shopping patterns (Cavalinhos et al., 2021) and consumer and buyer transaction efficiency, boosting a 30% earnings level within six months and making it a smoother and quicker process within minutes to establish a connection with a Global e-commerce adoption platform (Aeron et al., 2019; Chen et al., 2023). Moreover, female consumers and entrepreneurs understand and can adopt e-banking services technology (Poon, 2007; Raman, 2019). It enhances the volume of trading with brand products of virtual (VBP) digital innovation (Barretta and Fırat, 2022), ultimately increasing the economic growth in developing countries. The Consumer Protection Act 2019 and Consumer Protection e-commerce Rules 2020 also help to analyse the objectives (Chawla and Kumar, 2022; Mulligan et al., 2024) Blockchain technology supports vendors and small businesses through smart contracts and real-time transaction verification, which reduces dependency on intermediaries and minimises disputes. As highlighted by Hang and Kim (2019) and Rosillo-Díaz et al. (2019), blockchain systems can automate trade agreements, accelerate order fulfilment, and establish immutable transaction histories. These characteristics are particularly relevant for informal traders and street vendors engaged in e-commerce platforms such as Open Network for Digital Commerce (henceforth ONDC), where credibility, speed, and cost efficiency directly influence competitiveness in international markets.

Digital payment adoption has become a strong enabler for financial inclusion of informal enterprises, but to sustain their engagement and participation in domestic and global markets, a wider and more comprehensive digital ecosystem must be created. Digital payment adoption is used as the main empirical construct for digital transformation of the vendor, and blockchain technology enabled supply-chain infrastructure is proposed as a supporting technology to improve the degree of transparency, product traceability, documentation, and logistics efficiency. In view of this, this empirical evaluation aims to analyze the relationship of the various factors of digital adoption, business transition and socioeconomic upliftment from primary survey data collected from street vendors. Blockchain is spoken about as a notion that could be extended in discussions of future trends for connecting informal businesses to global value chains by enhancing digital infrastructure. This difference allows uniformity among the research goals, evidence presented, and policy implications derived throughout the study.

The research objective of this study is to examine the influence of digital payment adoption on business transition and socioeconomic upliftment among street vendors and also evaluate the mediating role of business transition in explaining the relationship between digital adoption and socioeconomic outcomes. Finally, discuss about the potential of blockchain-based supply chain infrastructure to work in tandem with digital transformation by enhancing supply-chain transparency, product traceability, documentation and logistics efficiency, which can facilitate integration with global value chains.

2 Literature review and hypotheses development

Looking at international experience, it becomes clear that much more is needed to achieve a successful integration of informal enterprises into international value chains than merely supporting the use of digital payments. In China, the digital markets and e-commerce platform–based ecosystems are allowing small producers and informal entrepreneurs to gain access to other domestic and international markets by organizing the logistics, using digital payments, and managing commerce through a platform (Bruce et al., 2023; Chen and Kimura, 2019). Likewise, digital financial inclusion and mobile commerce have been encouraged in Indonesia and Vietnam via the government-backed digital financial platforms, with the long-term success of these investments relying on investments in logistics infrastructure, in digital financial literacy, in institutional support, and in regulatory reform (Mulligan et al., 2024; Shanko and Zewdie, 2023). For informal businesses, mobile payment systems have effectively increased financial inclusion in several African countries such as Kenya and Ghana, but the engagement in international value chains remains limited due to weak logistics infrastructure, lack of product traceability and low digital literacy (Wilson and Makau, 2017). Taken together, these experiences from around the world show that digital technologies can only bring about sustainable socioeconomic impacts when they are accompanied by enabling infrastructure, institutional coordination and capability building.

The Technology Acceptance Model (TAM) has been used more extensively to understand intentions to use digital technologies and the Diffusion of Innovation (DOI) theory is used to explain the diffusion of innovations within social systems, but these models tend to focus on technology adoption and not the socioeconomic change of informal enterprises. Likewise, the Resource Based View (RBV) and Digital Capability Theory describe the processes by which organisations build their internal capability to accrue competitive advantage, with very little consideration of entrepreneurial transition in informal economies. This study grounds its conceptual model in two complementary technology-adoption theories. The Technology Acceptance Model (Davis, 1989) posits that perceived usefulness and perceived ease of use are the primary determinants of technology adoption intention and behaviour. Diffusion of Innovation theory (Rogers, 2003) extends this by explaining how an innovation's relative advantage, compatibility with existing practices, and observability of results drive adoption at the individual and community level. Together, these theories provide the behavioural logic for the Digital Adoption (DA) construct used in this study: DA items (UPI/QR usage, digital-training participation, ONDC platform access) operationalise TAM's perceived-usefulness and ease-of-use dimensions, while the progression from digital payment adoption to entrepreneurial Business Transition (BT) reflects DOI's diffusion trajectory, whereby vendors who perceive relative advantage and compatibility move from trial to sustained, structured adoption. Blockchain-enabled supply chain adoption is similarly conceptualised as a second-stage innovation-diffusion process: whereas DA/TAM constructs explain entry-level acceptance of digital payment tools, blockchain adoption represents a higher-order, infrastructure-level innovation whose diffusion depends on the relative advantage (cost/time savings), compatibility with existing trade practices, and observability of benefits (transparency, traceability) established in the DOI framework. This positions blockchain not as a disconnected technology but as the next diffusion stage building on the TAM/DOI-grounded digital adoption pathway.

Inspired by these insights, the present study aims to present an integrated conceptual framework where Digital Adoption is being used as a resource to enable Business Transition as a mechanism of building capability, and Socioeconomic Upliftment is the ultimate development outcome. The proposed model differs from previous research which focuses on either the adoption of digital payment or financial inclusion, as it highlights the indirect role digital technologies play in socioeconomic empowerment, and that is through entrepreneurial transformation (Chen and Kimura, 2019; Singh et al., 2020). Moreover, by adding blockchain-based supply-chain infrastructure to the existing theoretical frameworks, the paper adds a further layer of understanding that a digital inclusion alone is not enough for real participation in global value chains if there are no mechanisms to enable transparency, traceability, and logistics integration.

2.1 Digital payment adoption and market integration

The adoption of digital payment systems has significantly transformed small business operations, particularly in developing economies. Prior studies indicate that mobile wallets and digital financial services improve transaction efficiency, reduce cash dependency, and enhance customer reach (Shao et al., 2019; Singh et al., 2020). Empirical evidence suggests that digital payment adoption is positively associated with increased sales and improved market participation (Chen and Kimura, 2019). However, existing studies largely focus on formal small and medium enterprises (SMEs), with limited attention to informal street vendors. While some research highlights the role of financial inclusion in enabling digital participation (Yadav and Banerji, 2024), there remains insufficient empirical evidence on how these technologies translate into international market access for informal-sector participants.

In addition to increasing operational performance and consumer satisfaction as measured by mobile wallet services (Zeng et al., 2026), integrating digital solutions into street vendors’ supply chain and logistics management opens up opportunities for international trade (Singh et al., 2020). The adoption of digital tools enables street vendors to enhance their competitiveness, expand access to global markets, and improve supply chain efficiency, thereby contributing to the technological and economic development of the informal sector (Ghondaghsaz et al., 2022; Hagspiel et al., 2025; Radicic and Petković, 2023; Rodríguez et al., 2023). The ability of street sellers to trade internationally has been significantly impacted by the move to the new technology of digital payment (Khobragade et al., 2025) and the incorporation of e-commerce platforms (Yoon and Occeña, 2015; Zhu et al., 2020). Adopting digital payment is strongly associated with higher sales and market expansion domestically and internationally (Chen and Kimura, 2019); however, sustained assistance from the government is needed. Regulation, education with digital financial literacy (Yadav and Banerji, 2024), and (Samuels, 2025), the development of digital transformation is necessary for interaction-driven business and technology to reap the full economic rewards of this economic development (Arbeláez-Rendón et al., 2023; Gao, 2025; Van Veldhoven and Vanthienen, 2022). The reports (Kruh, 2017) and (TRAI, 2017) contribute to digital payment usage of the informal sector, like street vendors in India, and their assimilation into the global economy. Mobile penetration by 2016, India had over 936 million cellular users in rural and semi-urban areas. Internet users by 2017, it was predicted that 300 million Indians would use mobile internet, and digital wallet services like Paytm, BHIM, PhonePe, etc (Singh et al., 2020). UPI systems have significantly increased among small businesses with the help of fintech companies. Examines how FinTech research has developed—a bibliometric evaluation of financial inclusion and microfinance. Digital infrastructure development has increased reliance on technology for routine business activities (Devinatz, 2024).

2.2 Digital platforms, E-commerce, and vendor transformation

E-commerce platforms and digital ecosystems provide new opportunities for micro-entrepreneurs to expand beyond local markets (Junaedi et al., 2024; Sudirjo et al., 2024; Sugiharto, 2024; Wu et al., 2024). Studies show that digital platforms facilitate market access, improve operational efficiency, and enable entrepreneurial transition (Acharya and Berry, 2023; Dumitriu et al., 2019; Dwiandini, 2024; Zhu et al., 2020). However, contradictory results are found in the literature. Although some research has identified positive growth impacts, others have suggested that digital adoption is not enough to ensure continued income gains if other factors like logistics, digital skills and institutional support are missing (Van Veldhoven and Vanthienen, 2022). This implies that digital tools are enablers, but not the drivers, of economic results.

2.3 Blockchain and supply chain efficiency

The use of blockchain technology has been identified as a key innovation for supply chain management, offering increased transparency, traceability, and trust (Hang and Kim, 2019; Mulligan et al., 2024; Ungerman et al., 2018). Blockchain has been found to lower transaction costs, enhance contract enforcement, and speed up cross-border trading procedures (Babakan et al., 2025). Although these are the benefits of such systems, most studies tend to concentrate on formal supply chain and large companies. Few empirical studies have focussed on the impact of blockchain-powered logistics on the informal vendors or small-scale traders in international e-commerce. This disparity is especially pertinent in developing economies with inefficient infrastructure limiting the scope for trade expansion.

Digital transformation on informal economies should not be seen as a one-time technology but rather as a gradual process. Digital payment systems are a first step towards digital inclusion as they enable financial transactions, enhance financial access and promote the formalisation of businesses. While prior research has explored the factors of digital payment adoption, e-commerce participation, financial inclusion, and technology acceptance among informal enterprises, there is limited research that combines these different perspectives into a conceptual framework that explains how digital payment adoption relates to socioeconomic upliftment (Han and Li, 2021). The theoretical models currently available are mostly technology innovation diffusion with few studies considering the mediating effects of entrepreneurial business transition. Besides that, little empirical work has analysed how digital payment infrastructure and blockchain infrastructure for supply-chains work together to enable the progressive inclusion of informal vendors in global value chains. This study aims to fill these voids by developing and testing an integrated model between Digital Adoption, Business Transition (BT) and Socioeconomic Upliftment (SEU), and conceptually situating blockchain-enabled infrastructure as a catalyst for global market participation in the future.

2.4 Research gap

Digitisation of informal economies has drawn growing scholarly attention, yet the evidence base remains fragmented across three areas. First, informal-economy digitalisation research has largely examined isolated interventions, mobile money, e-commerce onboarding, or microcredit, without systematically tracking how these interventions cumulatively reshape vendor business models over time (Gopal and Davidson, 2025; Islam et al., 2024). Second, India's ONDC, launched by the Department for Promotion of Industry and Internal Trade (DPIIT) as an open, interoperable e-commerce protocol, has generated substantial policy discussion but limited peer-reviewed empirical evaluation of its effect on informal-sector vendors specifically; existing ONDC-focused literature is largely descriptive or policy-oriented rather than hypothesis-driven (Sehgal et al., 2024). Third, work on informal-economy digitisation more broadly (e.g., research on street vendor livelihoods) has rarely been integrated with technology-adoption theory (TAM/DOI) or tested with structural modelling, leaving the mechanism by which digital tools translate into socioeconomic outcomes under-theorised. Building on this, three specific gaps remain: This study addresses these gaps by combining PLS-SEM with machine learning techniques and focusing on informal-sector vendors in the Delhi-NCR region.

• limited empirical integration of informal street vendors into global e-commerce frameworks
• insufficient examination of the mediating role of entrepreneurial transition between digital adoption and socioeconomic outcomes
• lack of methodological integration between structural modelling and predictive analytics to capture both linear and non-linear relationships.

2.5 Hypotheses development

Building on TAM's perceived ease-of-use logic and DOI's relative advantage and compatibility constructs, digital adoption is anticipated to influence business transformation through vendors’ perceived value of digital tools, thereby enabling a move from informal to structured, entrepreneurial business activity. This shift should have positive impacts on socio-economic indicators, including income and access to services as well as engagement in wider markets. Furthermore, given the enabling role of digital technologies, Business Transition is expected to mediate the relationship between Digital Adoption and Socioeconomic Upliftment. This conceptualisation provides a structured framework linking digital inclusion with economic transformation while recognising the indirect pathways through which technology affects development outcomes.

• H1: Digital Adoption positively influences Business Transition.
• H2: Business Transition positively influences Socioeconomic Upliftment.
• H3: Digital Adoption positively influences Socioeconomic Upliftment.

3 Data and methodology

This study employed a sequential mixed-method research design that will support the identification of linear and non-linear correlations between the adoption of digital payments, blockchain-based logistics, and the results of international trade between informal street vendors. The methodological design is carried out in four steps: (i) pre-processing of data and the validation of constructs, (ii) dimensionality reduction and the control of multicollinearity by means of Principal Component Analysis (PCA), (iii) theory verification by the use of Partial Least Squares Structural Equation Modelling (PLS-SEM), and (iv) non-linear robustness and interaction of data by means of Random Forest models.

However, the study examines whether digital payment adoption and blockchain-enabled supply chain capabilities improve vendors’ preparedness for participation in international markets. Rather than assuming a direct increase in export performance, the analysis considers digital technologies as enabling mechanisms that support documentation, product verification, supply chain transparency, and regulatory compliance, all of which are prerequisites for successful cross-border trade.

3.1 Sampling process and collection of data

This study employed a mixed-method approach through Partial Least Squares Structural Equation Modelling (PLS-SEM). A purposive survey of 250 street vendors across Delhi-NCR was conducted between January and April 2024. Respondents were selected from participants of the PM SVANidhi and ONDC initiatives to ensure active engagement in digital payment ecosystems. While purposive sampling limits the statistical generalisability of findings, it is appropriate for this study as it ensures the inclusion of respondents actively engaged in digital payment ecosystems (PM SVANidhi and ONDC). This approach enhances contextual validity by focusing on information-rich cases relevant to the research objectives.

Regarding sample adequacy, the sample size of 250 satisfies established requirements for PLS-SEM. According to the “10-times rule” and recommendations by Hair et al. (2017), the minimum sample size should be at least 10 times the maximum number of structural paths directed at any construct. Additionally, a sample size above 200 is considered robust for exploratory SEM models. A post-hoc assessment indicates sufficient statistical power (>0.80) for detecting medium effect sizes, confirming the adequacy of the sample. The sample included vendors from agriculture (22%), small-scale manufacturing (31%), and service and retail sectors (47%). Using a standardised questionnaire, respondents were asked to rate their opinions on the use of digital payments, the shift to entrepreneurship, and socioeconomic advancement. All responses were recorded on a five-point Likert scale (1 = strongly disagree, 5 = strongly agree). The questionnaire was first tested with a small number of street vendors to check for clarity, wording and relevance to the context before implementing the full-scale survey. The final survey instrument was revised based on the feedback from the pilot study to make it more readable and valid.

The data collected were pre-processed to check for completeness, consistency, and quality of responses prior to statistical analysis. Questionnaires that were not completely answered or had significant missing data were not analyzed. Previously, all the remaining data were checked for coding errors, outliers and missing data before being subjected to statistical modelling. PCA was then used to reduce the number of indicators and to reduce the multicollinearity between indicators prior to the estimation of the model. These pre-processing steps helped to ensure the data was of good quality and more stable for the following analysis.

3.2 Measurement of constructs and model building

The use of PLS-SEM, PCA and Random Forest in this study is a multi-method complementary analysis. The use of PLS-SEM was justified as being the most appropriate method for testing hypothesized relationships between latent constructs, because PLS-SEM is an appropriate testing technique for exploratory research, complex models and relatively small sample sizes (Hair et al., 2017). However, the main limitation of PLS-SEM is that it focuses on linear relationships and may not be able to explain the multicollinearity and non-linear interactions fully.

The reliability and validity of the measurement model were evaluated using multiple complementary criteria. Internal consistency reliability was assessed using Cronbach's alpha and Composite Reliability (CR), while convergent validity was examined through indicator loadings and Average Variance Extracted (AVE). Discriminant validity was established using both the Fornell–Larcker criterion and the Heterotrait–Monotrait (HTMT) ratio. Variance Inflation Factors (VIF) were calculated to assess multicollinearity, and Stone–Geisser's Q² statistic was used to evaluate the predictive relevance of the structural model. Full collinearity VIF values ranged from 1.28 to 2.61, below the threshold of 3.3 (Kock, 2015), indicating that common method variance is not a serious concern. Harman's single-factor test revealed that the first unrotated factor explained 31.8% of the total variance, below the recommended 50% threshold, suggesting that common method bias is unlikely. The results satisfied the recommended threshold values, confirming the adequacy of the measurement model for subsequent structural analysis.

Principal Component Analysis (PCA) was employed as a preprocessing technique to reduce the dimensionality of the indicators and mitigate multicollinearity before model estimation by converting indicators into orthogonal components to address these limitations. This will increase the stability and interpretability of future modelling. Additionally, Random Forest (RF) was employed as a complementary predictive modelling technique to identify complex non-linear relationships that may not be adequately captured by conventional linear models. The algorithm constructs an ensemble of decision trees using bootstrap aggregation and random feature selection, thereby reducing overfitting and improving prediction accuracy. Variable importance was evaluated to identify the relative contribution of each predictor to the outcome variables. The Random Forest analysis complements the explanatory capability of PLS-SEM by providing additional evidence regarding predictor importance and model robustness.

As Secondary Data, we reviewed reports on the use of blockchain in export and trends in e-commerce transactions. This study examines how the use of a digital payment platform affects street sellers’ connections to global marketplaces. Data gathering, analysis, and statistical testing are some of the main steps in the technique, which assesses the connection between street sellers’ participation in international trade and their use of digital payments. A cross-sectional survey of street vendors in semi-urban cities, focusing on those using digital payment channels such as digital wallets and QR codes for international trade, served as the primary data source for this study (Merhi et al., 2021). Street merchants who participated in or were involved with the global market and used digital payment methods made up the sample. Respondents were chosen based on their active participation in digital payments and international trade to provide a varied selection of street sellers from different sectors. The study aimed to gather important information about the use of digital payments, the trade activities of street vendors, their income levels, the use of digital tools, and government regulations of international trade and financial inclusion. A comprehensive picture of the study sample was provided by documenting the respondents’ demographic data, which included age, education, and business scale.

Moreover, using statistical weightings and path coefficients, Partial Least Squares Structural Equation Modelling (PLS-SEM) can confirm whether digital adoption initiatives (such as PM SVANidhi, ONDC) have a favourable impact on employment diversification and business transformation. As illustrated in Figure 5, employment Opportunities and poverty reduction are influenced by observable factors like (Kwiringira et al., 2025) women's participation, health, literacy, income, etc. The effects of digital empowerment through digital payments, financial access, and technological literacy on poverty reduction outcomes, such as income level and quality of life, can also be statistically verified using PLS-SEM. Three latent constructs were modelled (Table 1) based on prior studies (Hair et al., 2017; Van Veldhoven and Vanthienen, 2022). Each latent construct was operationalised using at least three observed indicators. To mitigate sampling bias, vendors were selected across multiple market clusters within the Delhi-NCR region. Observations with incomplete responses exceeding 10% were excluded, while remaining missing values were addressed using mean imputation following robustness checks. All items were pre-tested with 10 vendors for clarity.

Table 1. Latent construction variables and their indicators in relationship with digital marketing for the PLS-SEM model.

3.3 Adoption of digital, transition to entrepreneurship, and improvement in socioeconomic status

This strategy will support street sellers empowered by digital inclusion, which links them to international marketplaces and enhances their standard of living, as shown in Figure 1 path visualisation.

To determine if BT significantly influences the relationship between DA and SEU by using tools like SmartPLS4, AMOS, etc (Collier, 2020). A significant change in the employment structure of suppliers between 2018 and 2024 is depicted in Figure 1. The number of people working in small-scale cottage industries and agriculture has significantly decreased, but the number of vendors running businesses has doubled. This change implies a move away from subsistence-based pursuits and toward entrepreneurial endeavours, which are primarily made possible by integration with official digital commerce platforms, digital payment systems, and microcredit availability. Figure 2 supports this change by demonstrating apparent improvements in key socioeconomic indicators. The majority of respondents were adamant that access to healthcare facilities, income levels, and living standards had all improved since the adoption of digital technology. Additionally, women's participation, increased literacy, and improved understanding imply that digital platforms like ONDC support inclusive development in addition to facilitating market access.

3.4 Regression model

Linear regression is one of the most fundamental and widely used statistical techniques for modelling the relationship between a dependent variable and one or more independent variables. It helps in forecasting, trend estimation, and determining the strength of predictors. The regression equation is as follows (Equation 1): The β1 is statistically significant in the case of blockchain, reducing logistic costs. Its positive impact on X4 signifies supply chain transparency and efficiency improved through vendors’ experience. This equation would have resulted in the adoption of digital payment to increase international trade volume. A high R² value indicates that digital payment drives vendors’ globalisation, which is a widely used technique by Collier (2020) to perform multivariate analysis on cross-sectional data, and to promote trade for street vendors’ small businesses. The factors responsible for connecting street vendors to international traders are: Digital payment adoption- increased sales, training and education, payment adoption, access to e-commerce platform sales, Government support for payment adoption, and customer preference- increased sales. Table 2 shows the impact of digital payment linkages on the global e-commerce market, the above variables, and their effects. It also analyses further through regression analysis.

Y=βo+β1X1+β2X2+β3X3+β4X4+€(1)

• Y = percentage reduction in logistics cost
• X₁ = blockchain adoption rate
• X₂ = order fulfilment time
• X₃ = Dispute resolution time
• X_{4 =} Transparency improvement
• € = error

• Digital payment adoption (effects on earning revenue and buyers’ outcomes)
• Training and education (digital capabilities of street vendors)
• Access to e-commerce platform (linkages with the global market),
• Government support and policies (incentives for using online payment and trading facilities) 5. Customer preference (consumers move forward to digital transformation).

Table 2. International trade and digital payment with the following variables and the e-commerce market.

3.5 Principal component analysis (PCA)

Principal Component Analysis (PCA) is used to solve any multicollinearity due to overlapping indicators of digital adoption and to form orthogonal components that maintain the greatest variance to be used in further structural modelling. It is basically aimed at removing the complexity of the data through the discovery of new axes known as principal components that explain the highest variance in the data. The common method of PCA execution includes data normalisation, developing a covariance table, and in that order performing eigenvalue or singular value decomposition. The eigenvectors obtained in the process reflect the major components, and the eigenvalues will measure the amount of variance of each component of the data.

4 Results & discussion

4.1 Measurement model evaluation

The result shows that the latent construct and variable and their reliability with the digital adoption for the PLS-SEM model (Table 3). All item loadings exceeded 0.70, along with the composite reliability (CR) and average variance extracted (AVE), which exceeded the accepted value by 0.50. Discriminant validity was confirmed through the Fornell–Larcker criterion and for model validity of Heterotrait-Monotrait (HTMT) < 0.85, ensuring construct distinctiveness (Hair et al., 2021).

Table 3. Measurement of three latent constructs and variables and their reliability with digital marketing for the PLS-SEM model.

In addition to Cronbach's alpha, CR, and AVE, further validation metrics were assessed to ensure robustness. Indicator reliability was confirmed as all outer loadings exceeded the recommended threshold of 0.70. Discriminant validity was evaluated using both the Fornell–Larcker criterion and the HTMT ratio <0.85 indicating satisfactory construct distinctiveness. Furthermore, predictive relevance (Q²) was evaluated using blindfolding procedures, yielding positive values for all endogenous constructs, confirming model predictive capability.

The present analysis highlights the significant developmental gains achieved in the Delhi–NCR region through the integration of street vendors into digital ecosystems supported by government initiatives such as PM SVANidhi and ONDC.. Utilising a Partial Least Squares Structural Equation Modelling (PLS-SEM) framework supported by robust empirical evidence and perception-based indicators, the study establishes a strong positive association between digital adoption, enterprise transformation, and socioeconomic advancement. The employment composition between 2018 and 2024 reveals a discernible transition from traditional cottage industries and agriculture toward self-owned business enterprises. This structural shift aligns closely with the core objectives of the PM SVANidhi scheme, which seeks to enhance financial inclusion and digital accessibility for informal vendors through microcredit and digital financial services. Simultaneously, the ONDC platform has facilitated the expansion of market linkages for small vendors, enabling their integration into both national and global e-commerce value chains.

4.2 Structural equation model results

Digital Adoption significantly drives Business Transition (β = 0.64), which in turn improves Socioeconomic Upliftment. But there is a direct linkages DA with SEU showing partially mediated with 21% (β = 0.21) defines less significant accountability without the role of BT. However, the indirect (supported) effect accounts for 63% (β = 0.63) of DA's total influence, showing that digital tools primarily empower vendors by enabling entrepreneurship rather than directly raising income levels as well as SEU (Table 4).

Table 4. SEM path analysis on digital adoption, business transition, and their relation with the socioeconomic upliftment.

The SEM was further evaluated using coefficient of determination (R²), effect size (f²), and Predictive relevance (Q²). Results confirm that DA strongly influences BT, which acts as a key mediator in improving SEU. The R² values indicate moderate to substantial explanatory power of the model. f² demonstrates that Digital Adoption has a strong effect on BT, and a moderate effect on SEU. Additionally, Q² values obtained through blindfolding confirm that the model has adequate predictive relevance. These results collectively validate the robustness and explanatory strength of the proposed PLS-SEM model (Table 5).

Table 5. SEM evaluation results followed by Hair et al. (2017).

• R² values of 0.25, 0.50, and 0.75 are described as weak, moderate, and substantial respectively.

• Effect size (f²): 0.02 = small, 0.15 = medium, 0.35 = large.

• Predictive relevance (Q² > 0) indicates model predictive capability using blindfolding procedure.

The SEM also demonstrates how company transition, a crucial mediator in boosting socioeconomic upliftment, is positively impacted by digital adoption. These results align with current research highlighting how digital inclusion in informal economies can have a revolutionary effect. Furthermore, ONDC's design highlights the potential of blockchain-enabled supply chain traceability, pointing to future directions for expanding vendor decision-making and ensuring product authenticity in the global market, supporting development and urban economic resilience.

4.3 Model 1: impact of digital payment adoption on international (trade volume) expanded business

This model examines how digital payment influences business in different sectors before digital payment adoption in 2018 and after digital payment adoption in 2024. The PM SVANidhi and ONDC initiatives have facilitated street vendors in Delhi NCR to adopt entrepreneurial and digitally integrated business models, diminishing reliance on agriculture and enhancing economic empowerment through digital inclusion. Consequently, it has impacted international trade (Figure 2) as well as the distribution of individual income (Figure 3).

From Figure 4, there were 150 farmers in 2018, but only 110 will remain as farmers in 2024. This indicates a substantial shift from conventional industries to entrepreneurial enterprises, perhaps fuelled by enhanced access to capital and digital platforms. The number of vendors in small businesses dropped from 50 to 40, which could mean that they are merging or transitioning to digital, and a sharp decline in the cottage industry. This finding suggests that digital payment adoption enables vendors to formalise transactions, establish customer trust and expand market access, thereby facilitating entrepreneurial transition rather than merely replacing cash-based transactions. The business sector saw a 100% increase in vendor involvement following the introduction of digital banking. ONDC's integration of digital commerce seems to have created new markets for vendors, thereby improving self-sufficiency and earning potential. The number of vendors has doubled from 50 in 2018 to 100 in 2024, highlighting trade opportunities in e-commerce and exports. Consistent Engagement has been seen in Small and Cottage Industries. A minor reduction (from 50 to 40 vendors) suggests stable participation, potentially attributable to infrastructural limits or size constraints within this sector.

Furthermore, the examination of socioeconomic variables shows notable advancements in financial literacy, access to healthcare, income levels, and standards of living (Figure 5). These results demonstrate that the use of digital technology goes beyond practicality and supports more general developmental goals, including community resilience, women's economic engagement, consumer and buyer purchase and selling decisions, perceived risks and diversity (De Moura Engracia Giraldi et al., 2022; Lăzăroiu et al., 2020; Özbölük and Akdogan, 2022; Santo and Marques, 2022).

The above Figure 5 data robustly endorse the notion that digital adoption facilitates street vendors’ access to e-commerce, global marketplaces, and blockchain supply chains, hence enhancing their trade volume and boosting their livelihoods. More than 150 sellers “strongly agree” that their earnings have gone up. This demonstrates how merchants can expand and reach new markets, including global e-commerce, with the aid of digital technologies (like UPI and QR codes) and platforms (like ONDC). ONDC aims to create a decentralised, open-source e-commerce network. To democratise digital commerce and provide equitable access for buyers and sellers across platforms, it is run by a private, non-profit Section 8 organisation. Digital adoption appears to enhance vendors’ capacity to manage digital platforms and global supply chains, according to high levels of agreement on knowledge, awareness, and literacy. Women's inclusion and improved service accessibility are markers of wider socioeconomic effects.

This supports the inclusive vendor onboarding strategy of ONDC and PM SVANidhi, which increases visibility and empowers underrepresented groups. The figure is a fantastic fit for the theme of this study. It offers factual evidence that digital transformation increases trade volume by opening up new digital markets, increases digital literacy, which makes blockchain integration possible and encourages social mobility and financial independence. This bolsters the main claim that integrating street vendors into the digital ecosystem promotes independent business ventures and their incorporation into international trade networks (Hung et al., 2022).

As seen in Figures 1, 2, PLS-SEM (Partial Least Squares Structural Equation Modelling) may undoubtedly be used to examine and confirm the beneficial effects of digital adoption on street vendors. In Figure 1, by sector (Agriculture → Business), Comparison of time (before and following the merger of Digital Bank), Adoption of digital technology (independent variable), Business expansion and entrepreneurial transition (mediating variable), and sectoral shift and employment growth (dependent variable) are observable factors that have been seen.

The integrated results reveal that digital transformation indirectly enhances street vendors’ socioeconomic status via entrepreneurial transition, but does not linearly predict trade volume when isolated. This aligns with prior studies (Han and Li, 2021; Van Veldhoven and Vanthienen, 2022) that show digital inclusion's primary effect is empowerment and skill-building rather than immediate trade outcomes. The PLS-SEM confirms the theoretical validity of the model (strong mediation through BT), while the Random Forest exposes complex, non-linear dependencies in vendor growth patterns. Together, these findings validate that digital adoption and blockchain-enabled platforms (e.g., ONDC) create pathways for inclusive growth, though effectiveness still depends on policy support, logistics efficiency, and digital literacy. The PLS-SEM model also confirms strong theoretical relationships, whereas Random Forest reveals complex, non-linear patterns implying that trade benefits depend on policy infrastructure, literacy, and global linkages rather than digital payment alone (Chen et al., 2023; Khobragade et al., 2025).

4.4 Principal component analysis (PCA) of selected variables

The principal component analysis (PCA), PCA-Based Regression Analysis, and Variance Ratio Explained (PCA Components) show that about 85% of the overall variance is captured by PC1 (39.69%), PC2 (24.42%), and PC3 (20.80%), indicating good dimensionality reduction. The Regression Analysis (With PCA Elements) R² = 0.049, suggesting that the model has poor predictive power, as it explains only 4.9% of the variation in transaction volume. Since all PCA components are statistically insignificant (p > 0.05), the amount of international trade is not significantly influenced by digital payments or associated factors. PCA decreased multicollinearity, but the model fit is still low, indicating that factors such as market size, vendor networks, and trade policy may be missing. For a clear analysis of data, non-linear models (like Random Forest) in Figure 6 better represent intricate interactions. Adoption of digital payments has a non-linear impact on trade, most likely through intricate market integration effects. A more thorough examination of PC1 might identify the initial causes of this influence, such as vendor revenue and trade obstacles.

4.5 Regression model accuracy

The fact that R² = 0.835 or 83.5% of trade volume fluctuation is explained shows that this model has a stronger predictive capacity than linear models. MSE is equal to 5.2M when the error is significantly smaller than in previous models, it indicates a better model fit. The performance of non-linear models, such as Random Forest, is significantly superior to linear regression. Where the top predictors are Digital Payment Adoption (31%), Income Growth (26%) and Export Frequency (22%).

Digital payment adoption and related variables reveal complex, non-linear connections to business. Non-linear interactions indicate that vendor income and digital adoption jointly shape trade outcomes — consistent with prior work emphasising multi-dimensional fintech effects (Van Veldhoven and Vanthienen, 2022). The most crucial component, PC1, shows that the primary underlying trend in the use of digital payments, and PC2 and PC3 have some predictive validity despite their smaller contributions, and they indicate secondary effects from related factors like trade barriers and vendor revenue growth. The expansion of international trade is not significantly influenced by the use of digital payments alone. Other elements (including effective logistics, access to international markets, and regulatory backing) might be more important. To meet the expectations of clients around the world, street vendors have embraced digital payments, which enable them to connect regional and international selling and trading of export brands and commodity loyalty (Bandara et al., 2020). Trade interaction significantly affects the amount of international trade.

Significance to the methodological understanding of this comparison is the fact that the use of digital payment has weak explanatory effectiveness in linear regressions and PCA-based regressions, but is a strong predictor in non-linear modelling. This deviation implies that the use of linear specifications has a limitation in analysing digital transformation in heterogeneous informal markets. The results are thus methodologically promising, given that they show the usefulness of machine-learning-based validation and structural equation modelling of development and trade studies.

4.6 Model 2: blockchain logistics and supply chain related to technology and infrastructure based on conceptual extension

The following discussion presents a conceptual extension of the empirical findings by examining how blockchain-enabled supply-chain infrastructure could complement digital transformation among informal enterprises. Unlike the preceding analyses, which are based on primary survey data, this section synthesises evidence from existing literature and conceptual modelling to explain how blockchain technologies may improve supply-chain transparency, product traceability, documentation, transaction verification, and logistics efficiency. Accordingly, the findings presented in this section should be interpreted as theoretical and policy implications rather than direct empirical validation from the present dataset. Figure 7 depicts the conceptual framework of the proposed model, wherein blockchain adoption functions as the independent variable exerting an influence on supply chain efficiency through mediating constructs such as logistics cost reduction, order fulfilment time, dispute resolution duration, and supply chain transparency. Greater integration of blockchain technologies is posited to facilitate more rapid and secure transactions, diminish operational expenditures, and strengthen vendor trust within the global supply network. Moreover, the deployment of smart contracts is anticipated to enhance vendor performance and further curtail post-adoption logistics costs. This model has developed the hypothesis as follows:

• H0: Blockchain adoption does not significantly influence supply chain efficiency or logistics costs.
• H1: Blockchain adoption significantly enhances supply chain efficiency and reduces logistics costs.

Table 6 shows that these variables jointly contribute to a higher volume of trade and improved vendor efficiency. The blockchain-enabled supply chain model (Model 2) demonstrates that technological infrastructure improvements can substantially strengthen informal vendors’ integration into global markets by reducing transactional frictions and enhancing trust. This finding supports the need for policy and platform-level investment in blockchain infrastructure under initiatives like ONDC.

Table 6. Variables with their description, with volume of trade and logistic costs.

The theoretical findings also indicate that digital infrastructure alone does not automatically translate into higher export performance. Instead, it creates an enabling environment by improving digital documentation, product traceability, authentication, and transaction transparency. Blockchain-enabled supply chains provide verifiable records of product origin and movement, facilitating compliance with international quality standards and reducing information asymmetry between buyers and sellers. These capabilities strengthen export readiness, while actual export performance remains dependent on additional factors such as logistics infrastructure, product quality, certification, customs procedures, and institutional support.

5 Government policy suggestions

In addition to ratify the current policy orientations, this research produces new evidence-based policy findings through differentiating between entry-facilitating and performance-facilitating digital interventions. Although digital payments are the main means of inclusion of vendors as well as transitions among the entrepreneurs, blockchain-enabling logistics and supply chain systems become the decisive factors in the real boom in trade volumes. This difference implies that the policies are concentrated on the digitisation of payment which alone will not be enough to facilitate internationalisation among informal vendors. Give small exporters access to QR-based payment methods and discounted mobile point-of-sale equipment. Improve cross-border payment interoperability to provide seamless multi-currency transactions. Encourage blockchain-based digital payment tracking to increase trade transparency. To offer small exporters and street sellers a low-interest trade loan program through the government. Establishing blockchain-based credit scoring to increase access to trade finance and using digital payment history as evidence of creditworthiness for lending. Street vendor taxes streamline export documentation and taxation for small-scale vendors through a straightforward process. Provide a free trade agreement (FTA) awareness program for street sellers and set up digital trade hubs to assist them in connecting with international markets. Encouraging training in e-commerce and digital literacy. Create digital literacy initiatives that emphasise the usage of international marketplaces such as Alibaba, eBay, and Amazon. Educate vendors on cross-border laws, drop shipping, and logistics. Collaborate with financial and e-commerce businesses to provide training materials that are vendor-specific. Bolstering supply chain management based on blockchain. Exporters’ profitability is lowered by supply chain and logistics inefficiencies. Implement supply chain tracking based on blockchain technology to ensure product authenticity and stop fraud (Rosillo-Díaz et al., 2019). Create smart contract platforms to automate trade agreements across borders. Encourage decentralised finance (DeFi) integration for immediate international transactions. Fintech and blockchain have the potential to completely transform vendor involvement in global e-commerce (Leonard and Jones, 2021).

International experiences also help in the learning process for India. Some countries like China have effectively supported small businesses to participate in digital commerce through a coordinated platform ecosystem and logistics system, whereas Southeast Asian economies have built digital inclusion through complementary investments in infrastructure and institutional support, India needs to go beyond merely financial inclusion. Future policy should focus on product traceability with blockchain technology, the streamlining of digital documentation related to exports, the integration of logistics, quality certification of the products, interoperability of cross-border payment systems and ongoing digital capacity development. This would help in making PM SVANidhi and ONDC more effective by helping informal vendors be more competitive in regional and global value chains.

6 Theoretical implications

The theoretical contribution of this study is the linkage of digital payment adoption and the adoption of blockchain technology to support supply-chain infrastructure in a sequential digital transformation process for informal enterprises. The empirical evidence confirms that digital adoption contributes to entrepreneurial transition and socioeconomic upliftment through capability development, while blockchain is positioned as a higher-order technological infrastructure that may facilitate future integration into global value chains. By distinguishing empirically validated relationships from conceptual technological extensions, the study provides a coherent framework linking digital inclusion, entrepreneurial capability development, and digital supply-chain transformation.

Followed these, this study proposes a tiered digital integration framework. At the first stage, digital payment adoption facilitates financial inclusion and market participation. At the second stage, entrepreneurial business transition strengthens organisational capabilities and improves business resilience. Finally, blockchain-enabled supply-chain infrastructure provides higher-order digital capabilities through enhanced transparency, product traceability, documentation, and logistics coordination, thereby supporting integration into global value chains. This sequential framework extends Digital Capability Theory by illustrating how progressive digital capability development creates sustainable pathways for socioeconomic empowerment among informal enterprises. Both theories, TAM and DOI, are not adequate to explain the diffusion of technology into long-term socio-economic change in informal economies. Similarly, RBV and the Digital Capability Theory offer an understanding of organisational capability development and have not paid sufficient focus on entrepreneurial transition of informal businesses. This study builds upon these discussions by suggesting that the pathway that leads to SEU is Business Transition that is enabled by the use of Digital Adoption. Instead of digital transformation being a one-off event, the study understands technology adoption as a continuous capability development process which takes the form of a journey from digital payments to entrepreneurial transition and finally to participation in digitally enabled supply-chain ecosystems.

Additionally, the study uncovers that blockchain-enabled supply chain capabilities and fintech adoption complement each other rather than being substitutable mechanisms in facilitating vendor globalisation. The digital payment infrastructure provides entry-level inclusion, while blockchain capabilities drive actual performance improvements in trade. The study thereby enriches and advances supply chain theory on blockchain adoption as it positions blockchain not merely as a tool for transactions but also as an infrastructure enabler for informal economies. In totality, these findings recommend a new concept of tiered digital integration, in which entry-level digitalisation must be followed by blockchain-based advancements so as to enable informal vendors to achieve meaningful and positive participation in global value chains.

7 Practical implications

The results of the research create some effective suggestions to policymakers, street sellers, online stores, and financial technology (fintech) companies. In India, a developing nation, researchers and policymakers should also make sure that the digital economy benefits all industries, but also includes the informal segment of street vendors. States can invest in digital payment training to educate informal companies and increase their chances of going international and raising their economic status. Subsidies and tax breaks should be provided in support of such initiatives to improve sales, accessibility in the market and general living standards in the informal sector.

The continuous digital literacy programs are important, and vendors can increase their confidence and sales rate significantly with the help of training programs. Partnership between citizens and the business will also lead to more business opportunities, affordable training centres, and the digital skills and knowledge required to enable people to engage in global trade. Enhancing the digital capacities of the vendors will enable them to take advantage of the fast-evolving global e-commerce ecosystem.

The local vendors can also benefit by using e-commerce platforms and local vendors to co-create localised innovation and upgrades, including local language support, efficient logistics, and integrated digital payments, as well as reducing barriers to entry of street vendors. This has been made possible through digital payment systems such as PhonePe, Paytm, Google Pay, and UPI, which have empowered vendors to enter the digital economy. The fintech firms must keep on investing in the improvement of the platform, enhancing security, interoperability, and ease-of-use, as well as providing low-cost transaction solutions to attract more street vendors to use them.

The Blockchain Logistics and Supply Chain Model highlight the essential contribution of technological and infrastructural innovation to the inclusion of participation in international trade. To street vendors in Delhi NCR, the application of blockchain (when brought together via digital tools, such as ONDC) can notably ease the impacts of transaction frictions, decrease the risks of operations, and enhance logistics coordination. Therefore, blockchain will be a technological facilitator of efficiency, transparency, and sustainability in informal trading economies, connecting local businesses more directly to the global digital economy.

Digital payment platforms and UPI-based services should prioritise interoperability with international payment gateways to enable vendors to receive payments seamlessly. Companies should also develop vernacular-language user interfaces and simple onboarding processes that are tailored to illiterate or low-literate informal vendors. Institutions relevant to ONDC should expand support for vendors beyond platform access so as to include supply chain traceability. This enables vendors to track orders, verify product authenticity, and resolve disputes efficiently, which directly improves their competitiveness and reputation in global markets. Development agencies such as SIDBI may use digital transaction histories as alternative credit-scoring inputs to enable vendors to access credit without collateral. Urban local bodies like municipalities should designate Digital Trade Hubs within existing marketplaces to provide hands-on training, logistics support, and e-commerce assistance to vendors. Because Business Transition significantly mediates the relationship between Digital Adoption and Socioeconomic Upliftment, policy interventions should focus not only on expanding digital payment access but also on strengthening entrepreneurial capabilities through digital literacy, business training and logistics support, with a view to lowering business costs and enhance trust in international transactions. This study has a number of limitations. The findings from purposive sampling cannot be generalized to other population. Probabilistic sampling methods and larger and more diverse sets of data could be used in future studies to increase the external validity of the findings. Since blockchain adoption was not directly measured through the questionnaire, the discussion regarding blockchain-enabled supply chains remains conceptual and should therefore be interpreted as a policy implication rather than empirical evidence. Future studies should develop and validate measurement scales for blockchain adoption among informal enterprises. Moreover, longitudinal studies might offer more comprehensive understanding of causalities and long-term impact of digital adoption.

Irrespective of some of the limitations, this research provides beneficial information on the significance of digital payment in enhancing international trade among street vendors. Does not take into account regional differences or analyse regulatory, cultural and infrastructural differences across India. Generalisation is limited as the sample size and varied in small size and limited to the rural and urban setting. Further study with larger and longitudinal data sets might be more appropriate to account for the impact of electronic payments on the fiscal results and internationalization of the vendors. Further studies should also be carried out on the economic transformation after COVID, the impact of digital tools on the supply chain, customer attitudes towards the new payment systems and sustainable adoption patterns, leading to greater competitiveness and environmental sustainability on the global level.

8 Conclusion

The results show that digital technology, coupled with the government programs, has positively affected street vendors financial inclusion, business transition and market access. For continued involvement in value chain participation, complementary investments in logistics infrastructure, digital capabilities, and supply-chain transparency will be needed. Digital payment adoption represents the first stage of digital transformation among street vendors by improving financial inclusion and business formalisation. The empirical findings demonstrate that this digital transition is positively associated with BT and SEU. Blockchain-enabled supply-chain infrastructure and global e-commerce participation are discussed as complementary technological and institutional mechanisms that may facilitate future integration into regional and global value chains rather than as empirically validated outcomes of the present study. To enable sustainable socioeconomic upliftment, investments should also be made in the development of entrepreneurial skills, logistics infrastructure, digital governance and supply-chain transparency. Reflections from international experiences underscore the importance of developing a successful integrated informal enterprise into global markets and the need for an enabling digital ecosystem, rather than individual technological solutions. Street vendors should therefore be the center of attention for the future policy agenda in India to bolster institutional and technological bases for them to become stakeholders in the global value chains. There are three significant contributions of this research to economic research. To start with, it presents one of the few empirical studies that relate street vendors to e-commerce in the world through both fintech and blockchain supply chains in an Indian context. Second, it demonstrates the usefulness of triangulating methodologies, i.e., a combination of PLS-SEM and non-linear predictive models, to affect the complex dynamic processes of digital adoption. Third, it reinvents the policy discourses by showing that digital payments are not adequate to spur international trade in the absence of developed logistics and governance infrastructure. In addition to e-commerce and mobile payments, the government policies and the changing consumer preferences are also contributing to the economic growth and financial stability of the informal sector. Within the framework of the methodology, this study provides a coherent outline for analysing the role of digital payments in street vendors’ participation in international markets. Using Partial Least Squares Structural Equation Modelling (PLS-SEM), the study methodically examines the effects of adopting digital payments on street vendors’ economic and trade activities, thereby making a valuable contribution to the discussion of financial inclusion and digital innovation in informal economies.

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Footnotes

Edited by: Bhawana Bhardwaj, Central University of Himachal Pradesh, India

Reviewed by: Suriya Klangrit, Chaoyang University of Technology, Taiwan

Ettishri Babusingh Rajput, National Institute of Fashion Technology, India