WhatsApp payments to launch in India later this year
Priya Wadhwa
10x Industry

WhatsApp payments to launch in India later this year

The Indian government has concerns over data privacy.

WhatsApp plans to launch its payment feature by the end of 2019 in India, its biggest market with 400 million users of the 1.5 billion users around the world. The feature is being tested since the past one year with a test group of 1 million users. However, it is still pending regulatory approval from India’s banking regulator.

The Indian government is concerned over data privacy, saying the information could easily be used by Facebook, risking customers’ non-commercial information. The Reserve Bank of India and NCPI, have since made it mandatory for WhatsApp to store payment-related data only on Indian servers within the country. WhatsApp has resisted this.

WhatsApp Payments will make it as easy to pay someone on WhatsApp as it is to send a message. We can't wait to provide this service to our users across India this year.
Will Cathcart, WhatsApp’s new global head

WhatsApp payment feature will compete with India’s PayTM and PhonePe. PayTM, which got its a large chunk of users when Prime Minister Narendra Modi demonetised the currency, has 350 million users, lower than WhatsApp, but still a massive number. Its international competitors within the country are Amazon Pay and Google Pay.

According to The Economic Times in India, “In the past, local rivals have alleged that WhatsApp’s payment platform has security risks for consumers and is not in compliance with the guidelines. ”

India is still sceptic about WhatsApp’s data storage and privacy concerns. It has asked the National Payments Corporation of India (NPCI) to look into the matter to ensure the data storage is done in accordance to the terms and guidelines. It is also looking to add another level of security for protecting data through the Personal Data Protection bill, due to be introduced in parliament soon.

We believe that if we did this right, it will accelerate financial inclusion and bring more people in India’s fast-growing digital economy.
Will Cathcart, WhatsApp’s new global head

WhatsApp is pushing its agenda for the payment feature in light of providing financial inclusion in the country. Considering many still live in rural areas with little access to advanced FinTech feature, yet due to the immense smartphone penetration in the country with one of the world’s cheapest data plans, WhatsApp could become a very popular choice; giving strong competition to PayTM.

If the regulatory approval does come through, India will become the first country in the world to gain access to this feature.

We have earlier mentioned that Facebook’s first investment in India, was in Meesho, an app that allows social e-commerce through WhatsApp. While Anand Chandrasekaran, ex-Facebook Messenger executive, has been actively investing in India-based startups developing messaging platforms similar to WhatsApp.

These and many other instances within the industry show the potential of private messaging platforms is big in the future. Addition of the payment feature is just a natural step in the grand scheme of things as the platforms’ potential grows. Brands have already adopted WhatsApp for business, making it only an easy point of contact with customers, but also for specialised marketing initiatives.