As India is moving towards digitalization era, hence most of the transactions are taken place through digital gazettes. When digitalization was introduced in India, the people were not much aware of these systems. But gradually they start learning these new techniques. The advanced digital wallet system, allows users to send/receive payment instantly within a fraction of seconds. For the study, the researcher has considered few small retail shops, which includes grocery shop, fancy, tailoring shop, vegetable shops, beauty parlors, medical stores. The study was undertaken in and around Mangalore city, the sample size for the study is 100 respondents who use digital payments for their transactions. The main purpose of this study is to determine the benefits and problems faced by retail shops from digital payment system. The results show that There is no association between usages of digital payment system and age of the customers. The study also highlights that, there is no association between problems of digital payment system and age of the customers.