10 Best Passive Income Ideas in India to Make Money in 2023
Want to learn how to earn while you sleep? Let’s explore the top 10 passive income ideas to make money in India in 2022.
You have a decent 9-to-5 job that gives you a steady salary income. But you just can't get past that gnawing feeling that there's more to be had.
You want more money and understand the value of multiple income streams.
You want more freedom, especially financial freedom.
You want more flexibility and know that being financially independent is the best way to achieve this.
So, you decide that it's time to increase your income. But how do you do this without quitting your job or ruining your performance at work? What are your options?
That's where passive income comes in. Passive income will supercharge your earning power and help you reach financial freedom more quickly.
Passive income also provides a financial buffer for dealing with the ups and downs of life—like changing jobs, switching careers, or caring for a sick loved one.
In this guide, we'll explore 10 of the best passive income ideas in India to make money in 2022 and explain the financial and time investment required to get each one up and running, the time to revenue, and how to get started.
At the end of the article, you will be well equipped with strategies to start earning passive income and be well on your way to achieving your financial goals.
Best Passive Income Ideas in India
From launching an ecommerce store to stock investments, these are the 10 best passive income ideas to make good money in India in 2022:
- Start a Blog
- Create and Sell Online Courses
- Launch an Online Store and Build Your Ecommerce Business
- Write and Sell Ebooks
- Make Money with Dividend Stocks
- Make Money with Airbnb
- Earn Passive Income with Peer-to-Peer Investments
- Selling Digital Products
- Investing in Real Estate
- Selling Photos Online
1. Start a Blog
Do a quick search for ways to earn passive income in India, and you can be sure that blogging will make it into the top 10 ways on most sites. This makes sense, as it’s an excellent way for anyone with half-decent writing chops to earn extra money.
Once the preserve of big business and large publications, anyone these days can build an audience and earn passive income from their blog as long as they put out great content.
Building a successful blog takes a lot of work, but once you get the ball rolling, it’s one of the most sustainable ways to earn regular passive income and can even replace your active income entirely—just ask the highest-paid bloggers of 2022.
For the best results, your blog should take a more personal, relatable approach; this will help it stand out from faceless corporate blogs and make you more likable.
A tremendous advantage of starting a blog is that you can easily turn it into multiple passive income streams, including affiliate links, sponsored posts, products, courses, and book deals.
How to Get Started
- Pick a niche: For your blog to be successful, you must focus on a specific niche because if it talks about anything and everything, it will be next to impossible to build an engaged and loyal audience. You can’t earn much from your blog without an engaged and loyal audience. When choosing a profitable blog niche, find one that you’re passionate about and has an audience that’s easy to monetize. Some of the most profitable blogging niches are personal finance, food, productivity, and health & fitness.
- Choose a blogging platform: Blogging platforms make launching and running your blog much easier. WordPress is the most popular option because it’s free and easy to use, but it’s not your only option. Other options like Squarespace and Wix are potentially easier to use and more beginner-friendly.
- Set up your blog: First impressions matter, and this is just as true with your blog as with anything else; the design of your blog matters. Thankfully, most website builders make designing your blog as straightforward as picking a theme or template from thousands of options.
- Get the word out: Even if you design the most beautiful and engaging blog and publish the best content regularly and frequently, you won’t get any readers if you don’t tell people about your blog. In fact, it can be argued that promotion is more important than how often you publish good content.
- Monetize: Finally, you must monetize your blog to start generating passive income from it. You can do this via ad placements, sponsored content, affiliate links, selling your own physical or digital products, taking on speaking engagements, consulting gigs, book deals, and television deals, among many other monetization strategies.
2. Create and Sell Online Courses
One of the best passive income ideas in India is creating online courses. Of course, this passive income source only works if you’re an expert in a particular subject or field.
As with most other digital products, online courses require a lot of upfront effort to create. But once you launch them, it costs next to nothing to deliver the product to more customers.
Your biggest competition is the numerous resources freely available today on the web. However, you can win if you pack a lot of value into your course beyond what’s freely available elsewhere.
As for ways to sell your course, you can either sell through online course marketplaces like Skillshare and Udemy or sell on your own website with solutions like Thinkific or LearnWorlds.
Using online course marketplaces is much easier since you don’t have to do as much marketing and all—that said, you still have to do some marketing.
But you also get a smaller piece of the pie due to fees and revenue share agreements, and the pie itself is often much smaller since most of these platforms rely on heavy discounts to sell more products.
In other words, using an online course marketplace will affect how much passive income you get from your course.
You have greater control over pricing and higher margins when you sell from your website. But doing this requires greater upfront and ongoing effort on your part.
How to Get Started
- Pick a topic and test your idea: Choose a topic you know a lot about or are willing to learn thoroughly and that many people want to learn about—this is necessary for your course to be commercially viable. Ensure that you test and validate the idea before proceeding because it makes no sense to invest so much time and energy into creating a course that no one wants.
- Create an outline: After picking and validating your topic, create an outline of everything you plan to cover in the course. Break the topic down into lessons and sub-lessons, making sure to define an objective for each lesson. It also makes sense to create assignments for each lesson to give learners an opportunity for hands-on practice.
- Create the course content: Your course content can come in any medium: video, audio, or text, but video is the most popular form. Creating a video course is not rocket science; you don’t have to be an Emmy award-winning cinematographer to make one. All you need for a start is your smartphone, a ring light, a cheap microphone, and a tripod. You’ll also need video editing software to edit your content.
- Choose your platform: The easiest option for launching an online course quickly is to use an online course platform. There are standalone platforms (like Thinkific, LearnWorlds, and Teachable), all-in-one platforms that provide a content delivery platform, marketing tools, and a website builder in one package (like Kajabi, Podia, or Kartra), and marketplaces (like Skillshare or Udemy). Investigate each type and choose the best option for you.
- Launch and promote your course: Market your course with both free and paid channels such as email marketing, paid ads, social media, website pop-ups, blog posts, affiliate marketing, and influencer marketing.
3. Launch an Online Store and Build Your Ecommerce Business
There’s no doubt about it; ecommerce is here to stay. Global sales topped $4.9 trillion in 2021 and are projected to reach an incredible $7.4 trillion by 2025, making it one of the fastest-growing business sectors.
It also has a track record that proves it to be one of the best vehicles to create passive income, build wealth, and achieve financial independence. The industry is just getting started, and there’s still a lot of room for growth.
What’s more, the barriers to entry get lower each year, thanks to ecommerce platforms like Squarespace Commerce and Shopify, which make building your ecommerce store easier than ever.
While this means increased competition, it also means you have no more excuses for not generating passive income.
How to Get Started
- Choose your platform: This choice is vital to the success of your business because your chosen ecommerce platform will serve as the control center for your entire ecommerce business. It should be easy to use, provide readily accessible customer support services, and come with seamless checkout and hosting for your ecommerce store.
- Choose an ecommerce vertical and a target audience: Ecommerce is notorious for slim margins. So, you should do all you can to reduce costs and maximize profits. One way to do this is to lower your customer acquisition costs as much as possible. Choosing a vertical allows you to do that by making it easier to find and attract buyers to your store and increasing your conversion rates and sales. Additionally, you should choose a target audience for your ecommerce business. Consider demographics (characteristics like their age, gender, occupation, education, and income), location, and psychographics (characteristics like interests, attitudes, opinions, and lifestyle) when choosing a vertical.
- Find products for your store: There are dozens of ways to find products for your ecommerce business. You can target hobbyists, hop on trending products, or go with products that appeal to your passions. But the most popular way by far is to look at what’s trending on online marketplaces like Amazon and Walmart, and several tools can help you do this, including Jungle Scout, Sell The Trend, and Dropship Spy.
- Set up your store: You must nail the design of your store because the design can determine whether people perceive your business as credible or not. When you’re done with the design, add your products to it with clear and descriptive product titles and descriptions. Set up inventory, pricing, and shipping, and add your contact, about, FAQ, and policy pages. Finally, connect your preferred payment gateway and add a custom domain name to give the store a professional touch.
- Launch the store and promote your business: Your store doesn’t have to be perfect from the word go. In fact, it should always be a work in progress. Launch now and improve over time, pixel by pixel. Of course, the next step after launching the store is to promote it aggressively. Don’t forget to install the Facebook Pixel and Google Analytics so that you can correctly track your marketing campaigns and uncover areas to improve your store conversion rates.
4. Write and Sell Ebooks
Want to know another excellent way to generate passive income for writers? Writing ebooks.
These days, you don’t have to wait to be discovered by a literary agent or deal with rejection after rejection until you find a publishing house willing to publish your work; you have Amazon KDP. Simply write your book, format it, design a cover, publish, and promote it.
And thankfully, you don’t have to be Mark Twain reincarnated to start earning passive income with this method. You can outsource every part of the process, from writing and editing to design and formatting.
Naturally, the barriers to entry are quite low since services like Amazon KDP democratize publishing, which means more competition. But you can still take advantage of this passive income stream by creating works that stand out from the crowd.
If you choose the right topic, use the title to hook the reader, ensure that the book contains insights that your readers cannot find elsewhere, and create a cover that sells the book well, you’ll be well on your way to making a ton of extra money and—who knows—possibly even new-found fame as a celebrated author.
How to Get Started
- Write and edit your book: You need to put in the maximum effort here so that your ebook turns out to be at least as polished as a hard copy book. Have the book edited thoroughly to rid it of inconsistencies in the plot and grammatical and spelling errors.
- Write a hard-hitting description: The description is not a synopsis of your ebook. The point is to give the reader a reason to choose it over the many other books treating the same topic. In other words, it’s a pitch to the reader, not a TLDR version of your book’s contents.
- Understand that the cover of your ebook is everything: A physical book has at least one advantage over an ebook from a marketing standpoint: the reader can flip through the pages and see something that captures their attention and makes them buy the book. Not so with ebooks. With ebooks, the cover does all the work. That should help you understand how important the cover is and should be enough to convince you to leave the cover design to the pros.
- Decide where to publish your ebook: Amazon KDP controls 67% of the digital publishing market. So, it goes without saying that you can’t afford to ignore them. But you also have other options like Kobo (popular in Japan and Canada), Apple Books, Google Play, and Barnes & Noble’s Nook Books.
- Publish and make noise about your book: Your work isn’t done after hitting Publish; you still have to create awareness about your book to get people to buy it. Even before publishing the book, you should already have a marketing plan in place so that you hit the ground running as soon as your book hits the digital shelves.
5. Make Money with Dividend Stocks
One of the least favored but highly effective passive income ideas is making stock market investments that pay a dividend. Most dividend-paying stocks pay out anywhere between 1 – 10% of the stock value each year as a dividend, which is extra income you can use as you please. It’s a 100% passive income source in which your money works for you.
The top-paying stocks for dividends are REITs (real estate investment trusts), blue chip stocks, and dividend ETFs.
When making these kinds of investments, there are a few things to remember.
First, stagger your dividend payouts throughout the year if you rely on them as a secondary income source. In other words, build your portfolio with companies that pay dividends in different months so that you get a dividend check each month, if possible.
Also, you want to pay attention to the company’s historical financial stability and how stable the dividends have been over time.
For the best results, look for stock market investments that have shown consistency in their dividend payouts for decades and have been able to raise their dividends over time to counteract the effects of inflation.
How to Get Started
- Open and fund your brokerage account: To purchase stocks, you must have a brokerage account. Thankfully, several online brokerages—such as AngelOne, ProStocks, and Zerodha—these days eliminate the need to meet physically with a broker or financial advisor. You can also buy stocks directly from the company through a direct stock plan.
- Look for stable, high-quality companies: Generally, companies that pay dividends are stable and have been successful for a long time. Look for undervalued stocks.
- Read the stock's quote and place your order: The market price and last dividend payment aren't the only important metrics to check when buying dividend-paying stocks. You also need to consider other metrics, such as the forward dividend and yield numbers, to get an idea of what you can expect to earn from it in the future. When you settle on a stock to buy, place your order.
- Take advantage of DRIP investing to grow your investment: You have two choices when it comes to cashing out on your dividends: either have it deposited in your brokerage account or reinvest the dividends to buy more stock. This is also known as a DRIP—or dividend reinvestment plan. DRIP lets you take advantage of compound interest and gives you fractional shares, allowing you to continue to build ownership instead of waiting till you have money to buy a full stock share.
- Monitor, rebalance, and grow your portfolio: Even if you don't make any changes to your holdings, your portfolio can shift. Therefore, you'll need to rebalance things from time to time. You should also look out for opportunities to invest in other dividend-paying stocks.
6. Make Money with Airbnb
Airbnb could be another excellent passive income source for you if you have a spare bedroom in your home. The platform connects you with people who are looking for their next getaway and want to live like locals while at it.
Many travelers prefer Airbnbs to hotels because they are cheaper, so there’s an excellent opportunity to generate passive income here.
This passive income source requires some work upfront—you might have to renovate or furnish your room or at least deep clean it before you list it.
So, if you don’t want to be actively involved in the business—possibly because you have a full-time job or other business—you can outsource management to a part-time property manager to create the listings and take care of the property. Remember that property managers generally charge 8 – 10% of the total rent collected.
How to Get Started
- Find out if you need permission to rent out the space: If relevant, you must get permission to rent out the space from our landlord. Read your lease; it might contain a provision for subletting. Also, check that there are no restrictions on renting your home on a short-term basis.
- Prepare the room: Usually, you will need to invest something in the space you plan to rent out. For example, you might want to install a keyless lock to make it easier for guests to check-in. You might want to build a wall to close off a room or invest in things that make the place more comfortable for your guests. The point is to see if there are any changes you can make that will make your listing more attractive.
- Set your prices: When setting prices, think about the audience, the market, and affordability. Note that Airbnb charges 3% of the booking fee—unless you have an extremely strict cancellation policy—and the price that guests see is higher than what you earn. Other factors that might affect your earnings include discounts, seasonal pricing, and taxes.
- Create your listing: When you create your listing, be honest; don’t exaggerate things or withhold information. Doing otherwise is a recipe for poor customer satisfaction and bad reviews; not good for your business in the long term. Highlight what makes your space special so that you stand out from other listings in the area, and include well-lit photos of the space.
- Consider enlisting some help: You might want to bring on at least one other person to help with things like emails and communications, repairs or special requests, urgent issues, and the check-in process. You can add them as a co-host to your listing (Airbnb allows you to have up to three co-hosts). They must understand Airbnb’s Co-host Terms of Service. There are also third-party companies that help hosts deal with inquiries, cleaning, and other things.
7. Earn Passive Income with Peer-to-Peer Investments
Some of the most commonly recommended passive income sources are savings accounts, fixed deposits, and certificates of deposit.
But they aren’t great passive income ideas because the extra income you get from them is minimal compared to your original investment.
To truly supercharge your ability to generate passive income and let your money work for you, consider peer-to-peer (P2P) lending.
In peer-to-peer lending, borrowers use services that connect them to investors like you instead of going to the bank to seek a loan.
That means you’ll be earning money via fixed payments monthly for lending to individuals or small businesses.
Peer-to-peer lending offers far more attractive interest rates than the tiny returns from your savings account, fixed deposits, and CDs promise, which means you can make enough income with a much smaller investment.
The high interest rate compensates for the high risk of extending unsecured loans to unknown persons. Generally, you invest through a P2P lending service that connects borrowers and lenders and vets the borrowers to protect the lenders.
P2P lending differs from an informal IOU in that the lending parameters and repayment plan are legally binding and overseen by a third-party platform that holds both parties accountable.
Individuals turn to P2P lending for many reasons, such as buying a new property, covering medical expenses, paying their way through post-secondary education, or buying a high-value asset like a car.
For small businesses, their reasons could be to fund an expansion, purchase new equipment, or even cover working capital requirements.
Bottom line, P2P investments are a great passive income source and, although high-risk, are a wonderful way to diversify your sources of passive income.
How to Get Started
- Choose a P2P platform: Find a platform that you can trust and that offers the best bang for your buck. You should be able to choose among several investment options and decide where you want to invest money. In other words, you want superior control over your portfolio, so it’s easy to diversify. Some of the best P2P platforms in India are RupeeCircle, i2iFunding, Lendingkart, and Faircent.
- Consider the minimum capital requirements: Your bank account might allow you to earn interest on your savings with any amount, but P2P lending usually has minimum capital requirements. You'll need to invest more money to generate more income and earn more money with P2P lending. Therefore, you must consider how much capital you can afford to have illiquid before considering P2P investment options. Although this income source promises strong returns, you get your money back slowly monthly. So, larger loans take much longer to earn back.
- Manage risk: In addition to connecting borrowers and lenders and simplifying processes, P2P platforms help mitigate risk. Consider the high risk involved in going off and lending directly to individuals all on your own. You have less information about the borrower, and there are no guarantees or protection. Another thing you can do to reduce risk is to spread your investment capital across multiple loans instead of putting all that money into a single loan.
8. Selling Digital Products
Digital products are typically downloadable files such as audiobooks, templates, PDFs, plug-ins, software, or any other media file you cannot handle physically.
They require no inventory, no logistics or shipping costs, and no manufacturers. They also boast high margins and no limits to how many you can sell; make the asset once and sell it repeatedly. These features make them very attractive and particularly suited to generate passive income.
With a platform like Shopify, you can automate the digital product delivery process via instant downloads, making this method the hallmark of passive income ideas.
How to Get Started
- Decide on what to sell: As expected, the first step to starting any business is to decide what you want to sell by brainstorming and researching ideas. Do you have any specific knowledge, experience, or skill you can teach others via an online course or ebook? If you already have a business that sells physical products, can you create digital products to augment the physical products? Can you create software to automate a repetitive task that you and many other people currently have to deal with daily? These are just some ways to develop ideas for your digital product.
- Test and validate your idea: Imagine investing so much time and effort into creating an amazing product, only to get it to market and find that nobody wants it. No one wants that; that’s why it’s important to verify your ideas before you create a product. The goal of testing your idea is to ensure that there’s a market for the product in the first place before you invest resources into creating it. Even when you’ve validated your idea, creating a minimum viable product to test your idea in the real world still makes sense before creating a full-scale solution.
- Create your product: Choose the simplest format to get the product to market as quickly and cheaply as possible; later, you can improve the product as you get feedback from real-life customers. You don’t want to waste your resources building a product with many fancy features and find that customers want a different feature set.
- Create an ecommerce store and promote your product: Throw together your ecommerce store and remember to disable the shipping features since you don’t need that. As soon as your store is up and running, drive traffic to it with techniques like paid ads, social media, and influencer marketing.
9. Investing in Real Estate
The first thing that enters the minds of most people when they hear real estate is their home. But there are several other options for real estate investors, and not all involve investing in tangible assets like buildings and condos. And whichever vehicle or method you choose, real estate will always be one of the best sources of passive income.
For example, you can invest in rental property and start earning rental income—an excellent passive income source and a surefire way to reach your financial goals and achieve financial freedom in record time.
Besides the rental income generated from their buildings, landlords also earn money from capital gains—that is, capital appreciation as the value of their rental property holdings increases.
If the property value increases—real estate tends to appreciate, but it all depends on market conditions and there are no guarantees—you can sell it at a profit or borrow against the added equity to fund your next investment. This makes real estate particularly useful for asset building.
Of course, if you become a landlord, you’ll be responsible for many things like property taxes, mortgage payments, property maintenance, finding tenants, and dealing with any problems. It’s a hands-on, 24/7 job.
But if you don’t want to be actively involved in managing your property, you can hire a property manager or work with a property management company to handle these details.
Real estate can be as risky as any other investment, so it makes sense to consult an expert—such as a real estate broker, agent, or investment advisor—before venturing out on your own.
How to Get Started
Here are four simple ways to generate passive income and earn money by investing in real estate:
- Owning rental property: This is an excellent opportunity for people with DIY skills and the patience to manage tenants. But even if you’re not that type, you can hire a property manager or outsource management to a property management firm. This strategy requires a substantial initial investment of money, time, labor, and other resources for upfront maintenance and to cover vacant months. Rental income is one of the best passive income sources.
- Real Estate Investment Groups (REIGs): If you want to own real estate without management hassles, you can go with an REIG. REIGs are similar to small mutual funds but invest in rental properties rather than stocks. A company buys or develops apartment blocks or condos and allows investors to acquire them and join the group. Investors can own one or several units, but the company will be responsible for managing the units, maintenance, advertising vacancies, and dealing with tenants. They charge a percentage of the monthly rent collected for performing these tasks. REIGs are some of the best sources of passive income.
- Real Estate Investment Trusts (REITs): REITs are more like mutual funds or exchange-traded funds—which are also excellent passive income sources—and are best for those who want to invest in real estate without doing a traditional real estate transaction. You can trade REITs on major exchanges—again, just like an ETF or any other stock. Like any dividend-paying stock you invest in to generate passive income, REIT companies pay regular income via dividend payments because they are required by law to pay out at least 90% of their earnings to investors. Unlike most other types of real estate investments, REITs also give you access to commercial investments like office buildings, malls, and other kinds of real estate investments that are generally outside the reach of everyday investors. They are also more liquid than most other forms of real estate investing since they are traded openly on major exchanges, which means you can cash out of your investment without involving a real estate agent or dealing with title transfers. In a sense, REITs are a more formalized version of REIGs. They are an excellent way to let your money work for you.
- Online real estate platforms: Also known as real estate crowdfunding, these platforms let you join others to invest in a bigger commercial or residential deal. One major advantage is that it requires much less capital than you would need to purchase a property or apartment unit outright. The most popular ones in India are SmartOwner, Property Share, Strata, and AssetMonk.
10. Selling Photos Online
If done right, photography can be one of the best passive income sources for you, even though it might seem like an active income business. You can make money from selling photographs, not just taking them.
Some ways to earn more money with photography are by selling your images to stock photo sites—like Alamy or 500px—and magazines and selling canvas prints of them online through your own ecommerce store. Stock photography sites will pay you a royalty every time someone uses your photo.
Whether you're a professional photographer working with the best photography gear or a hobbyist simply looking to make a few extra bucks with images shot on your iPhone, you can find many great opportunities to take advantage of this passive income source.
How to Get Started
There are several ways to earn passive income with photography. Here’s a list of just four of the best ways to do this:
- Sell stock photos to earn royalties: With this method, you create a stream of passive income and earn a royalty anytime someone buys your photos. A caveat here is that it's quite competitive, so you might not earn enough money to be able to replace your active income with this alone.
- Start a print-on-demand store and sell prints and products: Another excellent passive income source for photographers is to create a print-on-demand ecommerce store and sell prints and products with your photos on them. These products could be photography-based coffee table books, T-shirts, coffee mugs, and throw pillows. The best thing about this method is that you can easily outsource production to a third-party service like Printify or Printful.
- Create courses and tutorials on photography: This method requires a lot of time and effort upfront, but once you get the ball rolling, it can be one of the most powerful sources of passive income for you as a photographer. As a side benefit, it helps consolidate your reputation as an excellent photographer, which means you can charge more for your work in general—that means higher prices if you sell prints or products.
- Launch a photography-based online publication: If you also love the written word, you can start a blog or online magazine that combines your love for photography with your love for writing. It could be a fashion blog if you're a fashion photographer, for example. With a publication like this, you can make a fair amount of passive income from affiliate links, ads, sponsorships, and even your own products.
Passive Income Ideas FAQ
Passive income refers to earnings from any enterprise in which you are not actively involved, such as income earned from a rental property or limited partnership. In other words, if you’re earning money regularly from activities that require minimal effort on your part, that’s passive income.
For some, passive income is an avenue to augment their regular income and diversify their income across multiple streams.
For one, passive income makes it far easier to achieve financial stability, financial independence, and ultimately, financial freedom. It reduces your reliance on a paycheck and ensures that you're not dependent on a single source of income. Passive income also lets you become location-independent—meaning, you can work from almost anywhere—and gives you the option of early retirement if you want.
To quickly generate passive income, you can start an ecommerce store (especially dropshipping), become an Airbnb host, or invest in P2P lending.
Creating and selling a digital product has the highest margins and possibly the largest ROI of all passive income ideas. It takes a lot of effort to start, but once you launch it, you'll practically be printing money if you do it right.
What are the Best Ways to Earn Passive Income in India?
These are just ten of the best ways to earn passive income in India. At the end of the day, passive income ideas are a dime a dozen. But before you invest any time or energy into any idea, do your research to see if the claims are true and if it's for you.
Our recommendations for passive income ideas in India are as follows:
- Start a blog
- Create and sell online courses
- Launch an ecommerce business
- Write and sell an ebook
- Invest in dividend stocks
To learn more about making money and growing your income, check out the following articles:
- How to make money blogging
- How to start a profitable online store
- Steps to achieve financial freedom fast
- Best ways to make money online
- Best small business ideas to make money online
- Legit ways to make money from home