A man operates a machine that is capable of collecting used cellphones for recycling at a low-carbon technology fair in Beijing. [Photo/China Daily]

Zhou told China Daily: "The traditional offline deals are not transparent and user experience is very poor, which is the most significant distinction. In association with smartphone maker Meizu, we also offer a trade-in service. A consumer can buy a new phone for 20-150 yuan less by trading in his old phone."

Some of the recycled mobile phones are resold to users in third and fourth-tier cities where demand for used phones is high.

Others are exported to Southeast Asia and Africa at a low price. The rest are destroyed by a Hong Kong green plant.

"The mobile phone recycling industry is still nascent, but the coming year or two will see rapid growth. Online platforms will become the mainstream in future," Zhou said.

But for that to happen, awareness of recycling is key. Many consumers still keep used phones at home, he said.

But there are encouraging signs. For instance, 90 percent of sales of new phones are done through trade in deals, said Sun Wenping, president of the Shenzhen Mobile Communications Association.

Nearly 400 million old mobile phones are expected to be recycled as 452 million new mobile phones were shipped in 2014.

Experts, however, worry there are no standards yet in the phone-recycling segment, given its small scale compared to the scope for it.

Phone-recycling does not figure in the list of "Regulations on Recovery Processing of Waste Electrical and Electronic Products" issued in 2011.

Sun said the cost of dismantling old phones and extracting precious metals from them is high. Worse, there are no government subsidies for such units even though they play a key role in protecting the environment.

But the country has started to pay attention to this problem, Sun said.

Agrees Liang Zhenpeng, who tracks the consumer electronics industry.

Once subsidies are extended and standards adopted, the situation will improve, he said. "Recycling platforms are bound to develop very rapidly, which will attract attention of venture capital firms."