Whatsapp Payment Service Soon: NPCI

A Beta version of the Whatsapp has been running since last in our country and the stkeholders including its 300 million users are eagerly awaiting its official launch.  Many opine that Whatsapp can assist India emulate China’s WeChat Story and help achieve the cashless payment objectives.

• Couple of intermediaries like Google and Whatsapp are working on this which is still incomplete. Whatsapp is expected to be fully compliant in a couple of months.
• It is also interesting to note that Whatsapp has capped number of payment service users at one million now as it is yet to fully to meet RBI’s data localization norms which requires foreign companies to store transaction and user data within the country and ensure to delete the same from the foreign servers within 24 hours duration.
• NPCI Chief said that RBI appointed third party Audit Firm is in the process of ascertaining Whatsapp’s compliance and once the Auditors complete their probe review is expected to done and see how to go ahead and he expects that Whatsapp could be fully compliant in the next two months.
• Also, the NPCI chief added that other applicants like Xiaomi, Amazon Pay and True Caller have not been able to achieve five fold growth and are still see significant reduction in cash usage. Also he said that the number of digital instrument users has touched a million in the past three years and it will be a difficulty journey to  broaden the eco system.

Digital payments scene

• According to Niti Aayog survey, over three-fourths of the financial transactions are under Rs 100, and this is the space where unified payments interface (UPI) has to make inroads to replace cash.
• One step in this regard has been increasing the acceptance points.
• It is felt that an increased use of UPI platform (developed under NPCI flagship) by intermediaries like WhatsApp will help grow the digital payments scene.
• As of now, there are only 100 million users of digital payments, and this must touch at least 300 million to have any material impact on cash in circulation
• On the acceptance side, he said there are 3 million points of sale (POS) machines and 10 million QR codes active now. However, there must at least five-fold growth in both if we are to see any significant reduction in cash usage,” he noted.
• It is also learnt that Small value payments of under Rs 500 will be on UPI, while for the rest, cards will remain the mainstay.
• Also, a survey adds that only 5 per cent of digital users use scan-based features for payments, while in China it is over 600 million a day, mostly scan-based ones
• NPCI has no plans to launch a third version of the UPI platform now, but there will be regular incremental changes such as PAN verification, which will be available within the next two months,
• Also, in the area of tax incentives which is being planned to push UPI usage, it may take some time as it involves sharing a part of GST revenue as discounts.

Taking UPI overseas

1. NPCI is also planning to take UPI overseas to help those travelling abroad make payments through digital means.
2. The services will be launched in Singapore and the UAE by March 2020 in the first leg, and NPCI is already in talks with two more countries where there is said to be a good concentration of expats and a support system for QR codes-based payments mechanism.
3. RUPAY cards is said to be commanding 30 per cent market share both in volumes and value of transactions.
4. It is further felt that the user base will move up soon as Axis Bank and ICICI Bank will be launching Rupay credit cards soon. SBI Card already offers Rupay cards.