Digital payment systems have transformed financial transactions by enabling fast, secure, and cashless transfers through electronic platforms, and India provides a striking case study of this transformation. This chapter defines digital payments in contrast to traditional cash-based methods, traces their evolution from cards and bank transfers to mobile wallets, QR-code payments and the Unified Payments Interface (UPI) and outlines the conceptual framework involving stakeholders such as payers, payees, banks, service providers and networks, supported by technologies like encryption, tokenization, two-factor authentication and fraud detection. It categorizes the major modes of digital payments in India—including debit/credit cards, internet banking, mobile wallets, UPI, NEFT, RTGS and IMPS—while analyzing adoption drivers such as smart phone penetration, internet access, government initiatives like Digital India and demonetization and financial inclusion policies, alongside barriers like cybersecurity risks, privacy concerns, digital literacy gaps and rural infrastructure constraints. Empirical evidence highlights UPI’s exponential growth and its role in formalizing the economy, while benefits such as convenience, speed, transparency, reduced cash-handling costs and enhanced inclusion are weighed against risks of fraud, data breaches and systemic vulnerabilities. The regulatory landscape is examined through Reserve Bank of India guidelines, data-localization rules, consumer protection frameworks and interoperability standards, and future perspectives are explored, including Central Bank Digital Currency (CBDC), AI-driven fraud detection, cross-border innovations, and open banking. By integrating technological, behavioral, regulatory and policy dimensions, the chapter contributes to academic literature and offers insights for researchers, policymakers and practitioners engaged in finance, organizational behavior and digital transformation.