Abstract

Digital payment systems have become globally focused on the transition to the cashless economy and have become
an indispensable factor in the financial inclusion, and economic growth of the country, as well as environmental
sustainability. In light of the study explores how Artificial Intelligence (AI) enhances digital payment systems,
promoting a cashless and sustainable economy in Rajasthan. It examines AI-driven benefits such as fraud detection,
personalization, and efficiency, while addressing challenges like cybersecurity and digital literacy. The research
highlights AI’s transformative role in financial inclusion and economic development. we analyzed the impact of
digital payment adoption in Rajasthan with its benefits, challenges, and policy interventions. With a quantitative
survey methodology, data from the 100 respondents shows high digital payment adoption, with 40 items paying it
daily. Nevertheless, issues such as transaction failure and cyber security concerns prevent further growth. The
finding implies that while digital payments bring forward social, and economic participation and financial access,
these are thwarted by barriers of digital illiteracy and poor infrastructure as well. The promotion of digital financial
services has been a vital role played by government initiatives like Digital India, Jan Dhan Yojana, and Direct Benefit
Transfers (DBT). The essence of the study is that to advance Rajasthan to a cashless and sustainable economic
transition, it is very crucial to have improved digital literacy programs, a strong cyber security framework and better
infrastructure in place.