New Delhi, July 23 Growing at a compound annual growth rate of 30 per cent, the revenue of India's Software-as-a-Service (Saas) industry reached $3.5 billion as of FY2020, with 75 per cent of it coming from global sales, said a report by IT industry body Nasscom on Thursday.
India's burgeoning start-up landscape and its rapid strides in digital adoption are among the key contributors to the growing SaaS adoption in the country.
By 2025, the pure-play India SaaS industry has the potential to grow to $13-15 billion, said the study conducted in partnership with SaaSBOOMi and Zinnov.
Clocking a growth rate of approximately 1.5 times faster than the global SaaS landscape, top Indian pure-play vendors are dominating the SaaS market, with the top five vendors accounting for nearly 33 per cent of market share.
It is estimated that by 2025, the global addressable market for SaaS will be around $400 billion.
"It is phenomenal to see SaaS emerging as a key growth driver for the country. As a technology industry, we have barely scratched the surface when it comes to use cases that can be delivered via SaaS to benefit across sectors," Debjani Ghosh, President, Nasscom, said in a statement.
"India today needs greater cross-industry collaborations, supportive government policy, and investment in deep technologies, to further the growth of the SaaS industry exponentially," she said.
Fuelled by an increase in Cloud consumption, need for scalability and digital technology adoption, the SaaS industry, globally, has grown significantly with a market value of $100 billion in 2019.
From a geographical point of view, the Americas are the highest SaaS adopters accounting for almost 60 per cent of the market.
The US also accounts for more than 70 per cent of global SaaS funding.
India accounts for more than three million software developers and 100,000 SaaS developers as of 2019.
The Indian SaaS industry today has more than 1,000 companies with over 150 companies generating an annual recurring revenue greater than $1 million, said the report.
Chennai has emerged as the "SaaS capital" of the nation, generating $1 over billion in revenue, it added.
( With inputs from IANS )