WhatsApp’s plan for a widespread roll out of its payment platform has met with an unexpected roadblock. The government of India has reportedly held up Facebook’s plans for a nationwide roll out of WhatsApp payments over concerns about how users’ data will be stored among other issues.
According to Bloomberg, the Ministry of Electronics and Information Technology or MEITY, has asked WhatsApp and its partner banks to supply more information about the payments system. The people familiar with the matter reveal that the ministry has also requested National Payments Corporation of India, which oversees payments, to confirm that WhatsApp is fully compliant with its requirements. “We are working closely with the Indian government, NPCI and multiple banks including our payment service providers to expand the feature to more people,” Anne Yeh, a WhatsApp spokeswoman told Bloomberg.
The delay in the rollout of WhatsApp Payments comes at a time when the platform is already embroiled in a different controversy altogether. The Facebook-owned social messaging platform is finding itself in the crosshairs of regulators after multiple incidents of communal lynchings have been planned and executed using the service.
WhatsApp has been used to forward doctored images and fake videos of child abductions on the network that have gone viral. The issue has led to mobs beat and lynch about two dozen Indians in rural areas. The messaging platform has received warning from MEITY for inaction and it did take strong action with a new policy today.
It is not clear if this controversy played any role in government’s decision to stall rollout of WhatsApp Payments in the country. Reserve Bank of India has mandated all payment services to store user data on local servers to safeguard privacy and security. The delay in roll out could affect WhatsApp which is aiming to rival similar payment systems like Google’s Tez and Truecaller.
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WhatsApp has more than 230 million users in the country and its digital payments platform is already seen as a game changer. With the country moving towards digital payments in an effort to get rid of cash, WhatsApp was seen as the driving force. But the delay could mean that rivals will succeed onboarding customers who have been waiting for WhatsApp to start the payments platform.