Start-ups have an unlikely competitor — municipal corporations


New Delhi: Civic bodies are increasingly offering residents services such as booking event tickets, hiring taxis and scouting for house helps and cooks, entering territory that has so far been the reserve of internet start-ups such as UrbanClap, Quikr and Housejoy.

Among the first to do so was Ahmedabad Municipal Corporation, which launched mobile app Aajiveeka last year. The application, an initiative of the civic body’s urban community development department, helps people book services of qualified and verified professionals, including house helps, sports coaches and plumbers.

“Big cities have a good number of migrants coming from all across the country. In Ahmedabad alone, 30% of the population is non-Gujarati,” said Ahmedabad municipal commissioner Mukesh Kumar. “We saw such people witnessing huge difficulty in finding local services, so we decided to create a platform for both service providers and consumers.”

While the apps by government bodies are perceived as more reliable by the people, the challenge for the local bodies is to make the apps popular and present a simple interface, things that start-ups do much better.

“Local people in a tier-II city will have far greater trust in a government than a start-up,” said Sreedhar Prasad, a partner (e-commerce and start-ups) at advisory firm KPMG India.

The only challenge for the government is that they usually don’t do customer acquisition well, Prasad said. “To attract a digital Indian to download the app, that’s what start-ups tend to do well. But if governments find a way to plug this kind of start-up-like service into a common city app that citizens use for other purposes, this could work.”

The fee for services offered through the civic body app varies and is mutually decided between the two parties, Kumar said, adding that the cost of a one-time visit by a cook or a plumber could vary between Rs200 and Rs250. Based on usage, the demand is the highest for plumbers, beauticians, maids and cooks.

The municipal corporation plans to add more services such as music instructors and air-conditioning and refrigerator technicians.

Similarly, Surat Municipal Corporation is proposing to launch a mobile application called MySurat where consumers can book tickets for various events happening in the city such as plays, food festivals, fairs and exhibitions. Varanasi is planning to launch an app for hotel booking, while Bhopal is developing an app to facilitate ease of doing business.

Even the Delhi government has launched a mobile app called PoochhO for booking autos, cluster buses, carpooling and parking spots in the national capital in an effort to provide an alternative to Ola and Uber.

“We have got several proposals under the Smart City Mission, where civic bodies want to come up with such kinds of apps and we are supporting them too,” said a senior Union urban development ministry official, requesting anonymity.

There are currently more than 450 start-ups in this space both at the local and national level, according to market estimates.

The emerging trend of municipal bodies in this space will open up the home services industry and serve as a wake-up call for start-ups, said Prasad.livemint