comscore WhatsApp Payment: Messaging apps should focus on enhancing conversations

WhatsApp Payment: Messaging apps should focus on enhancing conversations

WhatsApp's transformation to support payments is something we didn't ask for and it is something we don't need right now


Over a decade ago, the process of chatting with your online friends was simple. Switch on your computer, and wait for your favorite instant messaging service Yahoo Messenger or MSN Messenger to start in the background and then initiate conversation with your friends. The communication didn’t happen instantaneously but there was a joy in talking to people through those platforms. I would regularly go to a cyber cafe at a designated time and use a PC connected to the internet for an hour to speak with a cousin in the US. The chats would mostly be in texts but I would often send emoticons and eventually mastered ALT key codes to chat faster before I ran out of time. Also Read - "Mobile payments exceeded ATM cash withdrawals for the first time" in India last year: PM Modi

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The world of messaging apps

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Today, messaging as a term is most commonly associated with Apple iMessage in the US, WeChat in China and WhatsApp in India. These three are responsible for ending text messaging or SMS as we know it. While Apple iMessage and WeChat are most frequently used in the US and China, respectively; WhatsApp is different with its global appeal. The Facebook-owned messaging platform has 1.5 billion monthly active users and over 200 million of them are in India. That number becomes significantly important considering that total smartphone user base is around 300 million, according to Statista.

I remember using WhatsApp for the first time on a smartphone called Samsung Galaxy Pop, which was back in 2011 and I migrated from an even popular platform called BlackBerry Messenger (BBM). If I recollect well, WhatsApp had only two columns – Chat and Contacts – in those days. Every time you added a new contact, it was necessary to go to contacts tab and refresh to see the new contact connected on the platform. Yeah, it can be called as the humble beginning of a soon-to-be unicorn.

User experience in WhatsApp

WhatsApp has always been about messaging, but since its $19 billion acquisition by Facebook, it wants to be a jack of all trades. The best cue for that statement comes by looking at the interface. WhatsApp right now has three columns – Chats, Status and Calls – in addition to a camera icon placed at the far left corner. On WhatsApp, you no longer can find contacts tab easily, just showing how big the application has gotten.

Today, a WhatsApp user can do following things on top of messaging – voice calling, video calling, ephemeral messaging (aka Snapchat clone) and of course, send animated GIFs. In the earliest messaging days, we relied on text primarily because our DSL connections were not capable of transmitting video and then came the revolutionary Skype which delivered video packets through its own servers to make video calling seamless on most networks. With the launch, video trumped voice in terms of priority and WhatsApp adding voice/video calls makes more sense since its core mission is to help people communicate. But does the mission include communication via payments?

WhatsApp Payments

Digital payments is a very sensitive subject in the country since our nation envisions a cashless future and wants to achieve it before any other western country. Almost every major Silicon Valley (SV) company wants to have a play here as evident from successful launch of Google Tez app. Facebook doesn’t want to fall behind and its best bet to implement the platform would be with WhatsApp due to its large user base. Yesterday, WhatsApp was found testing peer-to-peer payments via Unified Payments Interface (UPI) on its platform with a limited set of users.

The idea draws a lot of semblance to Apple Pay within iMessage and WeChat Pay on Tencent s popular messaging service. Apple claims to have 1.3 billion active install base of iOS which means equal number of users have access to iMessage on their devices and Statista estimates Apple Pay to have around 86 million users. WeChat, on the other hand, has over 960 million users (most of them in China) and serves as unified platform for everything.

WeChat differs from iMessage and WhatsApp. It is collectively the ‘Facebook’, ‘Apple’ and ‘WhatsApp’ for consumers in China. It’s the social network, payments platform and messaging service. It also allows its users to communicate with Pizza Hut to order Pizza or chat with Didi to get a cab. It is the only app you need while in China. It is evident that WhatsApp wants to be something similar.

However, the demographics of India is very different. In India, we have Facebook for social messaging, a few different wallets and UPI payments platform for digital payments and mainly WhatsApp for messaging. WhatsApp is not threatening Facebook here because it does not (won’t ever) want to become social network. Yet, its payments platform has the potential to kill all existing payments platform.

The key here is that this transition is something we don’t necessarily need. As Google demonstrated recently with its Files Go app, we use WhatsApp mostly for sending and receiving ‘Good Morning’ messages. In my case, I use the app mostly to stay updated with family members and know what they are up to despite the busy lifestyle. I asked myself a question, whether I am gonna use the platform for transacting to those people? The answer is neither Yes nor No.

Even USSD can do payments

Digital payments are possible even with USSD technology and we currently rely on techniques like NEFT and RTGS or cheque payments to make transactions. There are also 50+ BHIM or UPI-based payments app from leading banks to help you make UPI payments. Then there are wallets like Paytm and Freecharge to further provision the process of payments. We have more payments solution today than we need to do in real life and WhatsApp does not seem to be solving any existential crisis.

WhatsApp changed the way we talk with people and even today it does with new features such as GIFs, stickers and ability to switch between voice and video call. It does all of this without adding any clutter to the interface and the so called WhatsApp Pay could just end up confusing a set of users. The day it launches, I feel a lot of users will end up wondering whether they are supposed to make transaction now that it here.

WhatsApp Pay will definitely have a mass appeal, but do we need it in the first place? The answer is a clear no. There are already a ton of payment solutions and one would simply hope for WhatsApp to do what it does the best: a lean way to speak with near and dear ones, without the added frills of services and functions to distract you.

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  • Published Date: February 9, 2018 4:53 PM IST

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