India is WhatsApp’s largest market in the world by users, and is naturally one of its most important as well. Many of its features and tweaks are designed with Indian users and use-cases in mind, including its recent plans to introduce a payment interface to its service. WhatsApp payments will use the Unified Payments Interface (UPI), the quick bank-to-bank payment platform that has been adopted by various banks and payment platforms including Paytm, PhonePe and Google Tez.
However, WhatsApp Payments has been off to a slow start as the company’s small presence in India in an official capacity has cause problems with regulators. The Reserve Bank of India has mandated that all digital payments data should be stored in India on local servers, in order to allow ‘unfettered supervisory access’, according to a report by Reuters. In order to comply with this norm ahead of its full roll-out, the Facebook-owned company has announced that it will set up infrastructure to store the payments data in India.
WhatsApp is among the most popular instant messaging platforms in India, primarily because of its cross-platform usability that allows users on all kinds of mobile phones to use it. The app is available on Android and iOS, and recently even made its way to KaiOS for the JioPhone, which has taken over the feature phone segment over the last year. Enabling a payments platform on WhatsApp has significant advantages, which could propel WhatsApp to the top of the highly-competitive segment.
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The large active user base will find it easy to send direct funds to contacts, particularly when such a system is natively baked into the instant messaging platform that is already so popular. WhatsApp hopes that sending money for its users will be as easy as sending messages and images, which is already heavily used in the country. With WhatsApp adhering to local norms, other payment interfaces will be worried given that WhatsApp has a massive user base to start with and could take over a huge chunk of the market from the word go.