Low postpaid penetration in India-is it direct result of low per capita income?

Postpaid penetration in India is mere 5.8% as against other Asian countries like China-22.6%, Japan-99.7%, Singapore-62.7%, Malaysia-26.7% and many more. Many a times it is attributed to lower per capita income in our nation along with other market dynamics. Let us put this hypothesis to test!! 

Below graph plots postpaid penetration against per capita GDP at PPP (Purchasing Power Parity) for all major countries across globe. Countries are clubbed in GDP per capita buket and postpaid penetration is average of all countries in that bucket. Clearly,


High per capita income = High postpaid penetration 

Last two group defies this trend a bit due to very few countries in those bucket.




However this analysis treat every country with equal weightage, irrespective of their population size. Prepaid is important tool to cater a large mass of people. Having a postpaid infrastructure of bill delivery, stringent KYC, bill collection etc is not as easy for 100 million population as for 1 million. 

So let's dig deeper....


We filtered countries with over 100 million subscriber base. Now does the picture change?? 




Not much!! Though not strictly, but as per capita income increases, so does postpaid penetration across these 15 countries as well. Thus it clearly depicts that per capita incomes does play a strong role in postpaid penetration across all size of countries.  

So next time your manager ask you to increase postpaid sell ask for the support to improve income level of masses. :) :) 

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