India’s Startup Ecosystem Has Been Blown Away By WhatsApp’s New Payments Feature

WhatsApp’s payments feature hasn’t even made it to all phones yet, but it’s already created quite a splash.

India’s startup community appears to have been uniformly blown away with WhatsApp’s new launch. Prominent entrepreneurs have quickly got their hands on the feature, and have been gushing about how it fundamentally changes the payments landscape in India.

“This is a big deal. Very big deal,” tweeted former Flipkart CPO Punit Soni.

This is a big deal. Very big deal.https://t.co/zG9SjeY879

— punitsoni (@punitsoni) February 8, 2018

Niti Aayog CEO Amitabh Kant said it would radically transform the digital payments landscape.

WhatsApp moment of Banking will radically transform the digital payment landscape! https://t.co/wtplX82hf1

— Amitabh Kant (@amitabhk87) February 10, 2018

“Change happens gradually, then suddenly,” exclaimed Infosys cofounder Nandan Nilekani.

Good to have @WhatsApp on the @UPI_NPCI bandwagon. To paraphrase Ernest Hemingway, change happens ‘gradually, then suddenly’! https://t.co/joEQL4uHy3

— Nandan Nilekani (@NandanNilekani) February 10, 2018

And people eagerly tried out the feature for themselves, and couldn’t help but rave about how seamless payments were. “Made my first payment transaction on WhatsApp and I think this changes everything,” said Toppr CEO and angel investor Zishaan Hayath.

Made my first payment transaction on WhatsApp and I think this changes everything. pic.twitter.com/eJubYV0peL

— Zishaan Hayath (@Zishaan) February 9, 2018

Former GoIbibo CEO Ashish Kashyap also called it a gamechanger.

Whatsapp UPI payments is here #Disruptor #gameChanger pic.twitter.com/Pl3qUSsauY

— ashishkashyap (@ashishkashyap) February 9, 2018

Fintech entrepreneurs were also impressed. “Umm this kind of changes everything,” said ZestMoney cofounder Lizzie Chapman.

Ummm this kind of changes everything – I just made my first @UPI_NPCI payment on #WhatsApp @nikhilkumarks @dilipasbe take a bow pic.twitter.com/J5obrs8xFn

— Lizzie Chapman (@ChapmanLizzie) February 9, 2018

“Just tried WhatsApp Payments. Got reminded of what great user experience is all about,” said PayU CEO Amrish Rau.

Just tried #WhatsApp #payments. Got reminded what great user experience is all about ?

— Amrish Rau (@amrishrau) February 9, 2018

And entrepreneurs who were once in the payments business themselves were also impressed. Snapdeal CEO Kunal Bahl, who once had a P2P payment product of his own in FreeCharge, said WhatsApp would make P2P transfers easier than ever before. Snapdeal, of course, had sold FreeCharge to Axis Bank last year. 

Game changer! P2P transfers will be easier than ever before. As simple as sending a photo. https://t.co/mbN4qKDzWr

— Kunal Bahl (@1kunalbahl) February 10, 2018

FreeCharge founder Kunal Shah also tried out the feature. “Sending money is now as easy as sending pics on WhatsApp,” he wrote on Facebook.

Foreign journalists also realized how big a deal it could be. “If UPI for WhatsApp works, it will be the most impressive (not to mention biggest) payments mechanism outside China,” said Stanley Pignal, who writes for The Economist.

If UPI for WhatsApp works, it will be the most impressive (not to mention biggest) payments mechanism outside China. Despite being a huge fan of the UPI concept, I've found using it to be infuriating thus far. Really hoping this latest iteration is robust enough.

— Stanley Pignal (@spignal) February 10, 2018

It’s not hard to see why reactions have been so uniformly positive. WhatsApp has managed to integrate payments seamlessly into its chat messenger. Instead of having a separate tab for payments, WhatsApp has re-imagined payments as just another attachment that users send through its service. Millions of Indians already send photos and videos through WhatsApp everyday; it won’t be hard for them to make the leap to payments. It also helps that WhatsApp’s user sign up is seamless — instead of making people choose a VPA, it automatically assigns them one, making it much easier for the non-technical user to begin sending and receiving payments.

All this will worry other UPI players in the country. PhonePe, BHIM and Google Tez have spent millions of dollars in cashbacks and incentives to get Indians to transact on their platforms. But with WhatsApp now providing essentially the same functionality, it’s hard to imagine why anyone would use them to make payments. Most Indians already use WhatsApp multiple times a day — it’s only natural they’ll use it for payments as well. UPI apps had initially sought to disrupt cash, but they might end up getting disrupted themselves.