WhatsApp Payments service
by Facebook-owned WhatsApp could be launched as early as next week in India. While the news brings cheers to over 200
million active WhatsApp users across the country, it would certainly give
sleepless nights to incumbent online payment leaders like Paytm, which till now
dominates the e-wallet market with seamless e-payment services.
According
to a report published in Bloomberg, the Facebook-owned company could roll out
its payment service on WhatsApp as early as next week, for which it has
partnered with top three private banks in India -- HDFC Bank, ICICI Bank and
Axis Bank. The country's largest bank State Bank of India would also join in
once all "necessary systems" would be in place. The report cites
unknown sources claiming Facebook decided to launch the services next week in
light of its "rivals racing ahead" in the payment service game.
How
WhatsApp Pay will be different than other e-wallets
So,
how is WhatsApp Pay going to be different than other online e-wallets like others. WhatsApp has over 200 million users,
over 20 times higher than Paytm's daily active users. The WhatsApp Pay option
was initially launched for its selected users (on beta versions of the app) in
February 2018, and it had received positive reviews from its users.
"WhatsApp has a great starting point: a monopoly in chat. High engagement
makes it a credible competition," Vivek
Belgavi, leader for financial technology at PwC India, told Bloomberg.
Experts
suggest though the WhatsApp Pay option would more or less work on the same
principle of sending and receiving payments, its ability to allow users to do
it while chatting makes it a natural winner.
Besides,
Facebook is also eyeing to capture a bigger market share if it succeeds in
making WhatsApp more than just a messaging or calling app. Experts say Facebook
wants WhatsApp to be India's WeChat, a social networking app that allows users
to do everything from messaging, calling, shopping, payment, and host of other
services you can think of in just one app. WeChat also integrated its messaging
system with payments in 2013, giving a tough time to the domestic giant Alipay
whose market share slipped significantly after its launch.
Will
it change the way you pay?
With
the total active WhatsApp users equivalent to over half the entire population
of the US, to assume that a majority of smartphone users have WhatsApp
installed in their mobile phone will not be an exaggeration. The avid WhatsApp
users who use Paytm too would want to give it a try to make online payments for
shopping or cab services. While other companies have to invest tons of money to
acquire customer base, WhatsApp does not need to do it, thereby giving it an
edge over the other companies.
The
criticism over user security
While
the sheer size of WhatsApp user base is enough to scare its rivals, some
concerns regarding security requirements and no linking of other online payment
wallets seem genuine. Paytm founder Vijay Shekhar Sharma, a vocal critique of
WhatsApp Payments, had earlier said WhatsApp is openly colonising our payment
system and is customising UPI to their benefit and arm-twisting it for customer
implementation. He said a lack of login makes WhatsApp Payments an "Open ATM" to everyone and is a
security risk.
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