UPI AutoPay- Shaping India’s Subscription Business Landscape

Over the past decade, the subscription business has emerged as a foundation of India’s digital economy, offering customers access to countless services, from entertainment streaming to utility bill payments, investments, and insurance.

With growing customer preferences and increasing digitalisation, the introduction of UPI AutoPay in the year 2020 led to a paradigm shift. With its hassle-free payment mechanism, UPI AutoPay has transformed how subscriptions are managed and monetised across India.

Charting the Growth of Subscription Businesses in India

Putting Customers First

Subscription businesses offer a range of plans with varying features and prices, enabling customers to choose what suits them best. This focus on personalised services keeps customers at the forefront of the experience. A prime example is OTT platforms such as Netflix and Jio Cinema, which provide different plans at various price points.

As per Statista, the number of OTT users is projected to reach 600 million in India by the year 2025.

Emergence of UPI

The rapid increase in internet usage and the expansion of online payment systems in India have contributed to the fast growth of subscription businesses. As internet penetration rises, customer preferences evolve, enabling them to effortlessly access and pay for desired services in seconds.

As per PWC’s report, UPI transactions are expected to reach 1 billion daily by 2026-27.

Shift In India’s Consumer Behaviour

The spending behaviour of Indians is expected to experience massive changes in the upcoming years. By 2027, India’s consumer market will rank as the world’s third-largest, driven by an increase in middle to high-income households and a substantial rise in household spending per capita. It is expected to grow at a rate of 7.8% year-on-year. As a result of this shift, spending is set to increase across diverse categories, especially essential goods, services, and durables.

UPI AutoPay: Empowering Subscription Businesses

UPI AutoPay allows users to schedule fixed payments for subscriptions, utility services, and other expenses. AutoPay automatically deducts the mandated amount from the user’s bank account on the agreed-upon date.

Read More: How UPI AutoPay is Helping Businesses Scale

Let’s take a quick look at why businesses across the globe are pivoting to a subscription model.

Visibility into Cashflow

With UPI AutoPay, businesses eliminate the uncertainty of whether their customers will pay on time. Businesses know exactly when the payments will be processed, which helps manage cash flow.

Redefining Customer Experience

UPI AutoPay allows users to set up a payment schedule once and then forget about it. This ensures their bills are paid on time without manual payments. This results in an improved user experience.

Additionally, users can easily set up recurring payments with just a few taps, providing convenience. They can also adjust their subscriptions according to their preferences, including modifying or cancelling payment instructions.

What’s Ahead for Subscription Businesses

Business models based on recurring revenue have offered stability during uncertain periods like COVID-19. These models prioritise nurturing and retaining existing users instead of focusing solely on multiple one-time transactions from new users.

According to a global poll by Zuora, 57% of adults wish they could own fewer products. In comparison, a significant 70% agree that opting for subscriptions for products and services helps ease the drawbacks of ownership.

What it shows is that users prioritise having the freedom to choose the timing, location, and manner of using products and services. They seek flexible payment options and offerings, as well as personalized experiences and tailored offers that match their specific needs and usage patterns.

Overall, subscription models are more valued by users now than ever, and their popularity is likely to grow significantly.