India’s investors are increasingly relying on Unified Payments Interface (UPI) autoPay to evaluate user retention during fundraising discussions. By looking at recurring payment commitments, investors argue, they can determine whether a platform has genuinely active, paying customers or merely inactive "dead users”.
Data from the National Payments Corporation of India (NPCI) showed that the top 10 banks cumulatively processed nearly 1.8 billion UPI e-mandate transactions in July, more than three times the 585 million handled in July 2025.
This rapid surge in volume has prompted venture capitalists to look beyond surface-level payment figures. Investors are now interested in closely evaluating repeat customers by stripping out automated payment users who no longer actively visit the platform, said Ashish Kumar, co-founder and general partner at venture capital firm Fundamentum and F2A (Fundamentum Frontier Advisors). “Since autopay has picked up very well and is now mainstream, investors are asking the next question, which is a healthy sign for the ecosystem,” Kumar added.
Manavdeep Singh Grover, founder and chief executive officer of Superliving, an AI-powered preventive health and lifestyle platform, said UPI autoPay user retention has come up in all his fundraising discussions. “Let’s say 100 users renewed their autoPay this month. Of those 100 users, how many were actually using your app? That has become one of the most important metrics. If only 20% of paying users are using the app, your app doesn’t have any retention,” he said. Superliving recently raised $7 million in a Series A round led by LightSpeed.
Illustrating these concerns, an industry expert—speaking on condition of anonymity to discuss private transactions—said an investor backed out of a deal with a content company after discovering that most of its users were actually inactive on the app. “He did a lot of customer calls and found that most users were inactive on the app. So, it becomes important to understand what the real moat in content is and how replaceable it is. How do you build retention irrespective of this autoPay issue?" he added.
Adding to investors' concerns is the rapid proliferation of new companies entering the space. Prithvi Ramadhyani, director at investment banking firm IndigoEdge, said, “Fifteen months ago, there were only a couple of scaled companies that relied on UPI autopay and needed a deeper look. Today, there are more than two dozen companies using UPI autopay, and more investors are obviously meeting these companies and trying to learn more. Hence, awareness is more pronounced.”
Ramadhyani said that consumer tech companies now process at least ₹2,500 crore in cumulative revenue through UPI autopay, with smaller players adding even more to that tally. With such high volumes at stake, any potential shift in regulatory policy presents a far bigger risk today, he added.
Grover noted that investors are increasingly scrutinizing these metrics because they need a viable exit strategy. “None of these subscription companies have reached the IPO stage yet. During an IPO, you have to disclose where your revenue is coming from and what users are doing on the app. I think a lot of these apps could get exposed at a much later stage, which might lead to their IPOs not performing as expected.”
Bhagia of All in Capital said, “There are many startups who are kind of gaming it. You can see it in their Play Store reviews. Apps that have too many dead users will show up in Play Store reviews as well. There will be a series of one-star reviews saying, ‘My money has been cut and I don't know how to get it back.’ It shows up there.”
While UPI autopay was launched back in 2020, investor and regulatory scrutiny around it has increased sharply over the past few months. In February, Mint reported that the Reserve Bank of India had directed NPCI to investigate a surge in consumer complaints regarding unauthorized recurring debits and difficulties in canceling active mandates.
Globally, regulators are also clamping down on recurring payments. In July, New York City mayor Zohran Mamdani introduced a first-of-its-kind municipal ‘click-to-cancel’ rule, mandating that businesses make canceling a subscription as simple as signing up. Taking effect on 1 October, the regulation targets subscription traps across services ranging from gyms to streaming platforms.
Similarly, on 2 April the UK government announced new rules designed to make subscription terms more transparent and give consumers greater control over managing or cancelling them. The measures include simpler cancellation procedures, with businesses required to offer an online cancellation option for subscriptions purchased online. Consumers will also receive a 14-day cooling-off period when a free or discounted trial rolls over into a paid subscription.
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