Survey Highlights Low Adoption of UPI AutoPay Among Users
Bengaluru, 26 December 2024: UPI AutoPay, a feature that allows customers to automate recurring payments, was introduced as a solution by the National Payments Corporation of India (NPCI) to simplify subscriptions and recurring transactions. Even after four years of its existence, (kicked off by ex-governor Shakti Kanta Das during the 2020 Global Fintech Fest) a significant 60% of merchants who participated in a survey conducted by digital payments fintech, Phi Commerce, agreed that there is a need for higher awareness for this feature. 44% of respondents thought NPCI should put more newspaper advertisements explaining the feature and how to activate the feature to increase awareness.
60% of respondents made it clear that they were able to retain customers due to UPI AutoPay making a strong point that this feature has had a significant positive impact on doing business. A sizable 14% of respondents felt that 20% or more of their clientele continued with subscriptions after activating AutoPay. In a world where churn rates are an industry-wide concern, these numbers are quite groundbreaking.
The rise of digital payments in India was supposed to simplify everything. However, merchants found themselves caught up between managing customer satisfaction and optimizing cash flow. The advent of UPI AutoPay was intended to solve these problems. But does it?
55% of merchants reported an increase in customer satisfaction as the leading benefit of adopting UPI AutoPay. This is no small claim. For a feature that only began gaining mainstream attention recently, its potential to improve customer experience is already clear. Customers no longer need to worry about missing payment dates, leading to fewer disputes over subscription renewals. Also, 30% of merchants agreed that customers might end up paying more if they forget to manually stop the facility after they are done with a subscription.
In terms of operational impact, 35% of respondents indicated they had successfully reduced turnaround times for registration processes after integrating UPI AutoPay. However, nearly 25% of merchants still reported delays or difficulties in getting their customers to sign up for the feature. In the case of OTT platforms, 42% of respondents felt they could have been given a choice to select the AutoPay feature as against a mandatory click, at least in select bank mobile platforms.
30% of merchants cited concerns over the lack of customer-friendly navigation in UPI apps, specifically around the absence of an easily accessible “Manage AutoPay” button. This lack of visibility makes UPI AutoPay less intuitive when compared to similar features offered by international payment providers, where recurring payments are more seamlessly integrated.
Even as UPI AutoPay is improving customer retention and satisfaction, merchants and customers need more clarity and training on the system to achieve wider adoption. In comparison with other global recurring payment systems, UPI AutoPay is in its early stages, but its integration with India’s most popular payment interface offers significant advantages for long-term success.