If wallet companies thought they’d stolen a march over banks and other financial institutions by getting large numbers of installs and users, they might’ve celebrated too early.
Global messaging WhatsApp is looking to launch payment services in India on its app. Its career page lists an opening for a Digital Transaction Lead, and one of the minimum requirements is the “ability to understand and explain UPI, BHIM, Aadhar number,” and a preferred qualification is being bilingual in English and Hindi.
WhatsApp latches on to UPI
UPI had been launched last year, and banks had quickly scrambled to get on board – at last count 43 banks are on the platform. These banks had all launched their own UPI apps, which had met with varying degrees of success. Wallet companies too had recognized the threat, and hastened to bring their apps on the UPI platform.
But WhatsApp, if it does go ahead with the launch, will become the largest UPI app of all. Its userbase dwarfs the current userbases of the most popular UPI apps, such as government owned BHIM, SBI Pay and Flipkart’s PhonePe. Its user base is comparable to Paytm’s; but nearly half of Paytm’s claimed 200 million user-base has no money in its wallet or a stored card. Everyone and their grandmother at this point seems to have Whatsapp on their phones in India, and it could easily become India’s go-to app for peer to peer payments.
This ubiquity puts WhatsApp in direct competition with the government’s BHIM app, but Whatsapp has already been in talks with the Indian government. Just last month, WhatsApp CEO Brian Acton had visited India and met with Prime Minister Narendra Modi. Such visits are often herald a company’s entry into India in a big way – last year, Apple CEO Tim Cook had met the Prime Minister, and soon after had announced that it was setting up manufacturing facilities in the country.
Whatsapp’s effect on India’s digital transactional landscape could be transformative. No other app has the kind of reach that Whatsapp does, and its entry could be the death knell for smaller apps that had been offering peer to peer payments. It will also hit wallets – wallets had been positioning themselves as the best means to perform small offline transactions. With Whatsapp in the fray, users could well use Whatsapp to transfer money at their local kirana stores and small shops.
The model of a combined chat and transactions app has worked well in other countries – in China, WeChat effectively combines both chat and payments capabilities. Whatsapp already has a death grip on the chat in India – and the UPI will let it have payments abilities with relatively little engineering effort. Whatsapp has also demonstrated that it’s keen on moving away from simple text chat in the recent past – it’s launched video calls, and more recently, a Snapchat-like stories feature. With digital payments also in the mix, WhatsApp could well become India’s WeChat – the one app that rules them all.