Facebook-owned messaging service WhatsApp has secured regulatory approval for launching its digital payment platform, WhatApp Pay. The National Payments Corporation of India (NPCI) has granted the permission to the California-headquartered company on Thursday to operate WhatsApp Pay, which will cater to 10 million users in India during the first phase, Business standard reported. The NPCI approval came days after the Reserve Bank of India (RBI) nod to WhatsApp Pay.
Earlier last year, Facebook CEO, Mark Zuckerberg had announced that the company would actively be working to launch WhatsApp Pay in India.
WhatsApp right now has more than 400 million users in India and once it starts its UPI based Pay service, the sheer number would go beyond Paytm.
With the launch of payment services of its platform, WhatsApp will take on payment apps like Google Pay, Walmart-owned PhonePe, Amazon Pay and Alibaba-backed Paytm. These companies are already in fierce competition to dominate the digital payments industry in the country which is estimated to hit $1 trillion by 2023.
According to reports, Google Pay saw over 240 million UPI transactions in the month, PhonePe recorded around 230 million while Paytm numbers were pegged at 200 million.
When was WhatsApp Pay introduced?
WhatsApp Pay was launched in February 2018 in India as part of a trial run. Payments through WhatsApp were introduced under a partnership with ICICI Bank. On February 7, 2020, the messaging app received NPCI's approval to roll out its digital payment service in a phased manner. In the first phase, WhatsApp will offer payment services to 10 million users in the country.
How to enable WhatsApp Pay?
To use WhatsApp Pay, a user must initiate a payment to a contact. Once the request is received, the user can set up their UPI account on WhatsApp.
How to use WhatsApp Pay?
Users can send money directly through chat by tapping on the share file icon and selecting ‘payment’. The ‘payment’ section is available on the shortcut menu. Users can also check their transaction history and account details in that section. The payment system works on the Unified Payments Interface (UPI) method, where fund transfers can be initiated without having to provide bank account numbers and IFSC codes of recipients.
WhatsApp Pay: Transaction modes
WhatsApp Pay allows users to send money only to their contacts. WhatsApp users can also send money through QR code to people who are not in their contact list.