Earlier this year, Whatsapp was granted regulatory approval from The National Payments Corporation of India (NPCI) to operate WhatsApp Pay in India.
Now, WhatsApp is set to roll out its payments offering in India by the end of May, 2020 said two bankers aware of the development.
Read to find out more…
Pay Via Whatsapp Pay Now!
In the first phase of the roll out, three private sector banks- ICICI Bank, Axis Bank and HDFC Bank are to go live. The State Bank of India (SBI) won’t be a part of the first phase as told by the bankers.
The Face-book owned company had started beta testing with ICICI Bank. All the four above-mentioned banks were in the process of integrating with WhatsApp.
WhatsApp spokesperson told Moneycontrol, “We are continuing to work with the government so that we can provide access to payments on WhatsApp to all of our users. Payments on WhatsApp will help accelerate digital payments and this is particularly important during Covid as it is a safer way to transact for our 400 million users in India.”
Currently, both SBI and WhatsApp Pay are working closely through the integration testing phase. There are some outstanding observations of CERT-In Audit report submitted by WhatsApp Pay for which they seem to have sought time till 31st May 2020 to comply with fully.
As more convenience is made available to the users, the robust security architecture that’s required to be put in place is also given due importance and compliant with regulatory guidelines as well.
An SBI spokesperson said, “Bankers in the know of the matter pointed out that the public sector lender could have slowed down on its integrations with WhatsApp because of the delay in getting operational clearances from the central bank.”
Whatsapp Offering UPI Transactions!
NPCI had urged UPI third party players to move into a multi-party model so that the transactions do not disrupt any specific bank’s systems and high success rates can be maintained. Google Pay also operates with the above mentioned four banks.
WhatsApp has also updated its privacy settings with respect to all the three banks it is working with.
In the current form, WhatsApp will be offering Unified Payments Interface (UPI) based digital transactions between bank accounts. But the payments product will be released in a phased manner among consumers.
WhatsApp has 400 million users in India and the banks’ systems might clog with a sudden jump in transaction volume which is expected once the platform goes live. As per latest estimates there are slightly more than 100 million UPI users currently.
One of the bankers mentioned above said, “They will release the payments product systemically over the next few months, there was an initial plan to scale it up to 10 million but that got held up because of a public interest litigation in the Supreme Court.”
Why Whatsapp Pay Took So Long To Launch in India?
WhatsApp had started the restricted testing of its WhatsApp Pay with clearance from the NCPI back in February 2018. It remained in that stage in the past 2 years because the company faced multiple legal and regulatory hurdles. The delay in the roll out of the feature was due to the data localisation guidelines released by the Reserve Bank of India (RBI) in April 2018.
The other banker quoted above said, “It is working on adhering to the data localisation guidelines of the RBI and should be able to roll out payments by end of May.”
The approval for WhatsApp Pay came in for holding an invitation-only trial run from NCPI, and was followed by RBI’s go-ahead for the app in February 2020.
The Centre for Accountability and Systemic Change (CASC) has filed a PIL in the Supreme Court to stop the beta testing of WhatsApp’s payments offering in India.
In the recent years, India has in recent years emerged as a critical market for Facebook. The company has more users in India than any other country. The social networking giant partnering with a company like Reliance Jio augurs well for its prospects.
The WhatsApp Pay is expected to give a major boost to the digital payments ecosystem in the country.
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