The share of cards in recurring payments went down from 42 percent in January 2024 to 31 percent this year
UPI Autopay, the recurring digital payments platform for subscriptions, has seen its volume grow by three times in one year as more customers move away from cards towards Unified Payments Interface.
The UPI feature for facilitating seamless recurring payments has seen transaction volume through Autopay tripling to 175 million in January 2025 compared to 58 million it saw during January 2024, according to data available with the National Payments Corporation of India, which runs UPI.
The rapid growth has also helped UPI surpass the card-based recurring payments enabled through the Standing Instructions made through payment gateway companies.
While UPI Autopay was only 33 percent of all recurring payments in January 2024, this has crossed 53 percent in January this year, according to data from a payments company.
The share of cards in recurring payments went down from 42 percent last year to 31 percent this year. The rest of the recurring payments happen through Netbanking. The gulf between the payment methods has been widening since September when UPI crossed cards in recurring payments.
By enabling autopay on platforms like OTTs, insurance premium payments, loan repayment or bills, the money gets deducted at regular intervals from the customers’ bank account. UPI Autopay can be activated by entering the PIN as is for other UPI payments. The customer can cancel the Autopay at any time during which the subscription is active.
The customer registrations for UPI Autopay called mandate creation has also surged to 35 million during last month compared to 14.5 million mandate creations during January of last year. There is no aggregate card mandate registration data as it is with individual card issuing banks.
“UPI Autopay is a one-tap revolution that is transforming recurring payment hassles into a catalyst for explosive growth. We see a lot of companies getting revived because of the UPI Autopay subscriptions, especially in the edtech and content space. This could be a key solution for domestic small and medium software services industry as well,” said Vikram Chachra, general partner of 8i Ventures, which is actively looking to invest in startups enabling UPI Autopay.
How cards lost the plot
The rise of UPI as the default method for recurring digital payments for a large segment of customers did not happen naturally, instead owes a lot to the changing regulations as well.
The Reserve Bank of India’s regulations on recurring payments between 2020 to late 2022 including the additional factor authentication for card payments as well as the tokenisation mandate disrupted the standing instructions customers had placed using their cards. When the customers had to reenter card details for authorisation a second time, they preferred UPI, which by then had gradually become the most popular payment for merchants as well as customers.
“We see a lot of customers moving from card mandates to UPI over the last year as it is created on the same app rather than on a bank app. Also, it is easier to discover all the existing mandates for subscriptions on a single app. The same reasons why UPI is more popular than cards also holds true for Autopay as well,” said an executive with the payments company which shared the data with Moneycontrol.
While this has upended several customer and merchant subscriptions during the COVID era, merchants and customers are finally gaining confidence in giving a standing instruction mandate on UPI and prefer the platform over cards.
For instance, Apple’s Appstore does not allow card payments for subscriptions in India and prefers UPI, Netbanking or Apple Wallet. And it is a similar story for several large and small merchants.
Source: www.moneycontrol.com
