Latest news with #MunishVaid
Mint
08-07-2025
- Business
- Mint
UPI AutoPay set to drive incoming wave of consumer AI companies in India
The launch of UPI AutoPay has led to a new breed of startups and is helping others tweak their strategy to make the best use of the technology. The shift comes at a time when Indians are spending more time and money on the internet. AutoPay's adoption has been sector agnostic. Between 2024 and 2025, startups in edtech, wellness, health tech, fintech, as well as media and entertainment, have raised nearly $7.6 billion from venture capital firms, according to startup data intelligence platform Tracxn. Some of the firms that have adopted a subscription model or have enabled UPI AutoPay include content platforms like Kuku FM and Pocket FM, edtechs like SpeakX, Khare Classes, and Seekho, and wellness platforms like mental health startup Wysa and weight loss and nutrition tracking startup HealthifyMe. 'Anywhere that people need to make regular payments, whether it's towards entertainment or financial services, AutoPay is boosting that,' said Munish Vaid, vice president at global consulting firm Primus Partners. In 2025, India will have over 900 million internet users, according to a 2024 report from market research firm Kantar and the Internet and Mobile Association of India. As a result, UPI AutoPay's adoption is also set to increase. But it isn't new to us. Indians have always paid for television channels and newspaper subscriptions, and even milk. 'AutoPay has opened people up to subscriptions online. It isn't a new market, this is the offline market that is coming online,' said Anant Vidur Puri, partner at global investment firm Bessemer Venture Partners. Indians spend an average of nearly seven hours a day accessing various services and products on the Internet, according to social media intelligence firm Meltwater. Mobile devices account for 58% of this time. Launched in 2021, the National Payments Corporation of India (NPCI) introduced UPI AutoPay, a functionality for recurring payments that allows users to set up e-mandates for things ranging from electricity bills to mutual fund systematic investment plans to even OTT subscriptions. As a result, startups have pivoted their business models: subscription-first platforms priced for the Indian consumer. 'What UPI AutoPay has done is that it has enabled people to recurringly pay for something they want to pay for,' said Puri. The transaction volume of UPI AutoPay from the top 10 remitter banks nearly doubled to 29.29 million in May 2025 from 16.73 million in May 2024, according to data from the National Payments Corporation of India, which runs UPI. In contrast, the volume of UPI transactions in May this year alone stood at 18,677 million, valued at ₹ 25 trillion. Harsha Kumar, partner at Lightspeed India, said, 'UPI was the first large tailwind because of which transaction platforms such as ecommerce, transportation and utility all grew. Now, UPI AutoPay is the next big tailwind on the back of which we will see a bunch of fintech and content solutions come up. It's because these are two models where AutoPay or subscription works best." The volume of UPI transactions has gone to 13,116 crore in FY24 from 92 crore in FY18, a compound annual growth rate of 129%. For example, prior to UPI AutoPay, consumers would make mutual fund investments through systematic investment plans (SIPs), doing it through accounts on MF websites. Essentially, AutoPay makes it easier for people to set up their SIPs on brokerage apps like Groww, Zerodha and AngelOne. AutoPay reduces friction for both users and businesses. Traditional subscription systems use credit cards, a financial product with little penetration in India. In comparison, UPI AutoPay is mobile-first, low-cost, and works for small-ticket services. Thirty-seven million AutoPay mandate registrations were made in January this year alone. English-language learning startup SpeakX uses a subscription model, enabled by AutoPay. 'We've been able to capture a market which was untouched because digital penetration there was low. What it has enabled is access to people who want solutions, and it has become feasible for us to serve them at an affordable cost,' said company founder and chief executive Arpit Mittal. The company's product has seen considerable traction from lower-income groups as well as Tier-II and Tier-III cities, primarily due to its ₹ 300-a-month subscription model. Mittal argues that prior to the enablement of AutoPay, consumer companies had to be sales-led in order to convince users to join a platform. 'If I had to do SpeakX five years ago, my only option would be to sell packages to people, and not subscriptions. As a result, my product would be priced very differently and it would be out of the reach of many Indians,' Mittal said. SpeakX is raising up to $15 million in a pre-Series B round, the largest for a personalised AI-led edtech platform so far this year. Existing investor Elevation Capital has already paid the company. Other investors include consumer tech VC firm Goodwater Capital and global investment firm WestBridge Capital. Seekho, an online edutainment OTT platform, pivoted from a yearly payment model to a monthly one. The company had started out at the same time as the National Payments Corporation of India launched AutoPay back in 2021. At the time, monetisation wasn't the goal. By 2023, the company pivoted to a monthly subscription, led by AutoPay. 'It helped us drive good user retention, and for us, we saw it as an opportunity to finally build Netflix-like subscription businesses in India, something that wasn't possible before,' said Rohit Choudhary, founder and CEO of Seekho. As a result of the switch, the company was also able to increase its pricing, starting at ₹ 99 per month before raising it to ₹ 199 a month. That's what Seekho used to charge users yearly before. The pivot was led primarily because the company realised they could acquire more users and keep them engaged for less money spent. 'We saw recurring subscribers increase 3 to 4 months after we shifted to a monthly plan. After that, however, we had returning users coming back, which is where we saw hockey stick growth,' said Choudhary. Seekho claims that it currently has four million users and retains between 30 to 35% of its users over a 12-month period. Their market is spread across India. In terms of revenue, the company said they make ₹ 40 crore every month and that 85% of their user base are paying customers. Choudhary narrates a user interview who said that, considering they require ₹ 400 to recharge their phone every month, paying ₹ 200 to learn isn't a bad deal. 'This is how people compare their spends with Seekho. They don't really compare it with OTT platforms, but to a newspaper or a coaching class where they're paying to learn something.' But there's still a long road ahead. Often, the AutoPay mandate cancellations are hard to find, and users complain that they're losing money on something that they didn't want to continue to pay for. A letter had been sent to the Reserve Bank of India (RBI) from 'an aggrieved user' earlier this year, alleging unfair auto-debit practices from some of these startups. The letter said that some of these apps didn't provide users a simple way to cancel auto debits and were instead being forced to rely on UPI apps to make those cancellations. 'Eventually, builders will learn how to build for AutoPay, and consumers will learn how to manage AutoPay,' said Lightspeed India's Kumar. 'But we're headed in the right direction.'
Entrepreneur
09-06-2025
- Automotive
- Entrepreneur
Rare Earth Curb To Affect Smartphone Makers, Price Hike Likely: Experts
Opinions expressed by Entrepreneur contributors are their own. You're reading Entrepreneur India, an international franchise of Entrepreneur Media. As new restrictions on rare earth magnets imposed by China are starting to choke India's auto sector – heavily dependent on the import of the magnets – another sector which can be affected in the near future is smart phones. Smartphone makers might try to absorb the hit for a while, but if disruptions continue, it can lead to price hikes or even delays in new launches. In smartphones, magnets made from Neodymium and Dysprosium are used in speakers and microphones, haptic motors, and camera modules for OIS, etc. China holds almost a monopoly in processing rare earth elements. These rare earth metals are specially used to make powerful small size magnets that are found in almost every smartphone's components like in speakers, vibration units and display systems. As China tightens exports citing national security reasons, it has effects across the world. The problem: Price hike, delay in new launches "For India, this could lead to delays in getting key components or paying more to source them. Right now the bigger impact is being felt by sectors like electric vehicles but smartphones may also face similar issues in the coming time," said Munish Vaid, vice president, Primus Partners. Most Indian smartphone manufacturers depend on global supply chains which trace back to China. Therefore, even if India is not directly buying the raw material, any disruption at the source will affect the country. "While some of the final assembly for these components happens in India, rare earth magnet assembly for OIS, haptics, etc., is done outside India. While the auto sector might face the immediate effect of shortages and supply chain disruptions. Smartphones, although using less volume per unit of these magnets, given the sheer volume of smartphones produced, could see fewer advanced features, supply chain disruptions, or increased costs if the issue persists," said Parv Sharma, Senior Analyst, Counterpoint Research. China's curbs on rare earth exports threaten not only India but also global supply chains. With China controlling about 60 percent of global rare earth mining and over 90 percent of processing capacity, countries are likely to face bottlenecks, despite efforts on localizing production. If the situation drags on, the costs of smartphones are likely to go up. "Smartphone makers usually plan ahead and have stock for a few months, but rare earth magnets are used in components like speakers and motors that are hard to replace on short notice. If Chinese exports slow down or prices rise, that added cost will eventually add up in the final product. It may not be huge at first, but for low-end smartphones, where margins are thin, these can either reduce margins for companies or consumers will have to bear the burden of price rise," explained Vaid. How can India seek immediate relief Indian OEMs and Tier-1 suppliers are likely to accelerate efforts to diversify rare earth sourcing from regions such as Australia, Africa, and Myanmar. In the short run, India should look at building reserves and sourcing from other friendly countries such as Vietnam, Malaysia, Russia or Brazil. These countries have rare earth deposits and are eager to reduce global dependence on China. India already has some rare earth reserves of its own. "We need to ramp up local processing and manufacturing capabilities. The government's production-linked incentive (PLI) schemes could be expanded to support this space. Also, we should invest in recycling, old smartphones and electronics contain magnets that can be reused if we set up the right infrastructure. At the same time, our manufacturers and tech companies need to innovate," Vaid added. "We expect a stronger push to develop domestic refining capabilities. The government may also ramp up exploration and extraction of rare earth reserves in Andhra Pradesh and Odisha to strengthen long-term self-reliance in critical materials," said Soumen Mandal, senior analyst, Counterpoint Research. According to IDC, in the first quarter of 2025, India's smartphone shipments reached 32 million units. The number of phones made in India every year is big, hence, even a small increase in component prices can add up quickly. "With newer smartphones packing in more features, like better sound, stronger vibrations and advanced displays, the reliance on rare earths is increasing. The impact may not be as huge as in cars, but it is something that could affect both pricing and innovation down the line," Vaid explained. There will be challenges in the near term to increase value addition in India — in the longer-run India will have to look for alternative sources — increase local production and recycle to de-risk from the global supply chain.
