WhatsApp Pay is still on the sluggish road, four months since launch

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Transactions via WhatsApp’s Unified Payments Interface (UPI) remained tepid in March, four months after the service was made available to the messaging app’s 20 million users. Despite early forecasts that WhatsApp payments will take off once the feature was launched, WhatsApp only accounted for 0.02 percent of UPI volumes and 0.01 percent of the transaction value.

According to industry executives contacted by FE, the low number of transactions may be because the Facebook-owned company has yet to begin enforcing its payment plans. On the condition of anonymity, a senior executive with a private bank said, “They haven’t quite given it a push, at least not yet.”

This means they haven’t started actively acquiring merchants to allow peer-to-merchant (P2M) transactions. Besides, the payment feature has received little marketing attention, and the majority of WhatsApp’s 400 million users in India do not have access to it. The company’s WhatsApp for Business app, which was created specifically for Kirana shop owners, has about 15 million users. In 2019, the company launched catalogs for shop owners to use in showcasing their goods to consumers, and in 2020, it expanded the business app with new features.

Until the time of publication, an email requesting a response from WhatsApp India on its payment strategy had gone unanswered. The company announced in December that it would allow the selling of “sachet-sized” health insurance products through its website. Abhijit Bose, head of WhatsApp India, said at Facebook’s Fuel for India event that the messaging giant is also operating pilots in the areas of micro-pension, edtech, and agritech.

Though WhatsApp’s payment partners include State Bank of India (SBI), HDFC Bank, ICICI Bank, and Axis Bank, the company’s pension and insurance partners include pinBox Solutions, HDFC Pension Management Company, and SBI General Insurance. “WhatsApp has been aggressively performing on a variety of pilots to make sure that each adult has access to the foremost basic and vital financial livelihood resources through their mobile device. We expect people to be ready to purchase affordable sachet-sized insurance through WhatsApp by the top of this year,” Bose said, adding that the corporate is additionally working on pension services for India’s informal sector.

When WhatsApp launched a beta version of its payments service for 1 million of its 230 million users in February 2018, Credit Suisse predicted that the feature will cause digital payments to “explode,” causing the market to rise to US$1 trillion in five years.

PhonePe led the UPI market in March 2021, handling 44 percent of all transactions and surpassing the 1 billion transaction mark during the month. Google Pay and Paytm came in second and third, respectively.

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