Audiobook platform PocketFM, for example, has seen monthly recurring revenue growth of 350% in the past three months since launching the micropayment subscription offering in February, Ashu said. Behl, senior vice president, content, PocketFM.
Under the offer, 15 million of its monthly active subscribers can access a section of a publication for a fraction of the price, before subscribing to the full book.
In fact, more and more content platforms are asking users to pay a rupee or two instead of buying expensive digital content or subscribing to services all at once.
In December 2020, music streaming platform Spotify had introduced a feature-rich prepaid “mini” plan, to offer ad-free music streaming and offline downloads on ₹7 per day, or ₹25 per week. In a statement, a Spotify spokesperson said the Mini plans help the company add new paid users. “The bag culture, coupled with the ease of payments with the unified payment interface, has made micropayment options suitable for the Indian market,” he added.
The sachets were introduced in 1983 by the Indian brand FMCG CavinKare.
Today, the sale of sachets accounts for 75% of the shampoo market in India, according to market statistics firm Future Markets Insight.
Micro-transactions are also expected to help digital content platforms grow at a steady pace, in line with the growth of digital payments in the country.
A report on the Indian digital payments industry released on June 3 by consultancy Boston Consultancy Group (BCG) and Indian digital finance platform PhonePe said that digital payments in the country today have an aggregate value of $3 trillion and is expected to reach over $10 trillion by 2026. While around 40% of all payments made today are online, this figure will rise to over 65% in the next four years, and UPI payments will account for 75% of those transactions, according to the BCG-PhonePe report.
According to Ranadurjay Talukdar, partner and leader in payments consulting at consulting firm EY India, around 20% of all digital payments fall under the micro-transaction category, and this has increased over the past year with more in addition to users connecting online, and had the convenience of UPI. “To take advantage of this trend, companies are offering ‘micro’ plans,” he added.
Like PocketFM and Spotify, revenue from vernacular live-streaming platform Bolo Live has grown 4x in the past year to ₹36 crore with an increase in sales of ₹10 digital elements like stickers and tokens. Varun Saxena, Founder and Managing Director of Bolo Live, said more than 350,000 app users are opting for micro-transactions.
Keerti Singh, co-founder and vice president, growth, of award-winning gaming company Hitwicket, said two out of five users make a micro-transaction when making their first online payment.
“We have seen over 40% of paying Indian users make the first in-game purchase through micro-transactions, which contribute up to 20% of our revenue. In India, we have seen a 300% increase in the rate of converting non-payers to payers through in-app transactions,” Singh said.
EY’s Talukdar said it was helpful that there were no additional fees for a UPI transaction such as processing fees. Affordable smartphones, along with the democratization of the internet through cheap mobile data plans, have helped the cause of cashless payments in India, he added.
Micropayments help platforms generate revenue in Tier II and III marketplaces as Tier I marketplaces continue to generate high-volume online payments at this time, a spokesperson for payment gateway Razorpay said. . In 2021, Tier II and Tier III cities “saw 45% and 54% growth in online transactions, respectively,” and some of that came “primarily” from microtransactions, he added.
“In terms of sectors, the largest contributor was food and beverage, followed by gaming, bill payments and e-commerce. In 2021, sectors contributed over 57% of total transactions made on the platform,” he said.
“Users find microtransactions to be more democratic in nature than subscription models,” Saxena said.