The evolution towards a cashless economy is reshaping the architecture of financial systems across the globe, generating significant transformations in how economic growth, consumer behavior, and financial stability are structured. Over the past decade, technological advancements and state-driven reforms have accelerated the transition from cash-based exchanges to digital financial ecosystems. Countries such as Sweden, China, and Singapore have emerged as leading examples, where digital payments have become integral to both retail and institutional transactions, fostering greater transparency, efficiency, and innovation. India, too, has undergone a substantial shift towards cashless systems, with landmark policy initiatives including Digital India, demonetization (2016), the Unified Payments Interface (UPI), and Direct Benefit Transfers (DBT). These interventions have significantly expanded digital financial access, enhanced consumer convenience, and streamlined government-to-citizen welfare distribution. Yet, despite the rapid uptake, challenges surrounding digital literacy, rural accessibility, and cybersecurity remain persistent. Haryana presents a unique setting for examining this transformative shift. Strategically located in northern India, the state reflects a dual identity: on one hand, it is a strong agricultural hub, deeply reliant on rural communities and traditional cash-based systems; on the other, it is home to industrial and technological centres such as Gurgaon and Faridabad, where cashless payments have rapidly integrated into business and consumer lifestyles. This combination of advanced urban financial ecosystems and underdeveloped rural infrastructures provides fertile ground for evaluating the uneven impacts of a cashless economy. The present study focuses on Haryana to analyse three critical dimensions of the digital transition: economic growth, consumer satisfaction, and financial stability. To capture this complexity, the study adopts a hybrid methodology, blending primary and secondary research with advanced Artificial Intelligence (AI)-driven analytics. Primary data were collected from structured surveys and interviews with consumers, merchants, small and medium enterprises (SMEs), and government officials across Haryana’s urban, semi-urban, and rural regions. Secondary data were sourced from official records of the Reserve Bank of India (RBI), National Payments Corporation of India (NPCI), and state-level reports. AI enhances this methodological framework by enabling data cleaning, predictive modeling, and sentiment analysis. Machine learning algorithms such as regression models and decision trees were employed to assess the relationship between digital payment penetration and indicators of economic performance, including GDP contributions, SME revenue growth, and tax compliance. Natural language processing (NLP) was applied to consumer feedback datasets, enabling thematic extraction of issues such as trust, security concerns, ease of use, and satisfaction levels. Clustering algorithms further segmented respondents into adopter categories—early adopters, hesitant adopters, and resistant groups—helping identify behavioral barriers and opportunities for targeted interventions. The findings of this research underscore the transformative yet uneven nature of Haryana’s cashless economy. On the economic front, there is clear evidence that the adoption of digital transactions has accelerated growth. SMEs in urban and semi-urban regions reported increased revenues, faster transaction cycles, and reduced operational costs. Financial stability has been reinforced through greater transparency, higher tax compliance, and reduced leakage in government welfare delivery, particularly through DBT channels. Furthermore, digital payments have contributed to formalizing segments of the economy that were traditionally cash-driven, thereby strengthening fiscal resilience. From the consumer satisfaction perspective, results show that convenience, transaction speed, and accessibility remain the most valued aspects of cashless transactions. Yet, satisfaction is tempered by persistent concerns about cybersecurity, online fraud, technical failures, and hidden charges, particularly among rural and less digitally literate populations. However, the research also highlights significant challenges. Urban centres such as Gurgaon and Faridabad enjoy widespread digital adoption, supported by robust internet infrastructure and high digital literacy levels. In contrast, semi-urban and rural districts such as Jhajjar, Hisar, and Rohtak exhibit slower adoption, driven by limited connectivity, inadequate digital awareness, and a cultural reliance on cash. Moreover, the lack of effective grievance redressal mechanisms in cases of fraud reduces consumer trust, thereby hindering further adoption. These disparities illustrate that while the benefits of a cashless economy are substantial, their distribution across Haryana remains uneven and inequitable. To bridge these gaps, the study recommends a multipronged approach: targeted infrastructural investment in internet and mobile networks in underserved regions, localized digital literacy campaigns designed to reach rural populations, and AI-driven cybersecurity solutions that can detect and mitigate fraud in real time. Additionally, public–private partnerships (PPPs) between government bodies and fintech firms are proposed as a means to accelerate innovation, extend outreach, and instil consumer confidence. By adopting these measures, Haryana can ensure that its transition to a cashless economy is both inclusive and secure. In conclusion, this study contributes a comprehensive assessment of Haryana’s journey towards cashless financial systems, situating its experience within the broader national and global context. The results suggest that if strategically managed, a cashless framework has the potential to act as a catalyst for sustainable economic growth, improved consumer satisfaction, and strengthened financial stability. However, this potential can only be realized by addressing regional disparities, fostering consumer trust, and leveraging advanced technologies such as AI to safeguard and expand digital participation. Haryana’s case offers valuable lessons for India and other emerging economies—underscoring the delicate balance between innovation and inclusivity in the construction of future financial systems.