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Why is WhatsApp Pay taking such a long time to launch in India?

This weeek Apple announced the launch of its new Credit Card that works in tandem with Apple Pay. The payment system isn’t yet available in India and I’ve already voiced my concerns regarding the delay.

India has emerged as a leader in mobile payments thanks to dirt cheap data connectivity and increasing smartphone adoption. The industry got a huge boost after 2016’s demonetization and government initiatives like Jan Dhan Yojana have brought millions onboard the digital banking arena.

Google is operating a payments app called Google Pay, PayTM has a virtual monopoly on e-wallets, every bank is pushing its banking app, and homegrown services like PhonePe are hugely popular. In the midst of so many players, the underlying backbone is common, and run by NPCI (National Payments Coporation of India). Yes, I’m talking about UPI (Unified Payments Interface).

It’s a standard protocol that lets you transfer money without depending on a account number. The transfer process is instant and reliable. Even WhatsApp wants to be a major player in India’s rising addiction to digital payments and intended to launch WhatsApp Pay built right inside the messenger.

Users can easily send money via UPI and its as simple as sending a GIF. But, the feature isn’t available for everyone yet. In February 2018, the company rolled out the feature via a Beta channel and only a million users are able to access it right now. It’s been more than a year, what is stopping WhatsApp from rolling out a public release?

According to a report in The Economic Times, RBI (Reserve Bank of India) says WhatsApp is still not compliant with the data localisation norms in India. Even though it set up a mechanism to store data in India last October, this center merely copies the data locally while the original information is still available on the data servers abroad.

As per the RBI’s norms, payment firms were supposed to store all their data locally from October 15, 2018. The country is a prime market for WhatsApp with more than 200 million active users. Competing apps like Hike have implemented a similar feature long back, but WhatsApp still retains an edge due to its wide as well as deep penetration among India’s users.

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1 Comment

  1. mukesh kamath
    April 2, 2019 at 12:41 PM — Reply

    If they had launched Whatsapp Pay as a separate application just like how Ali Pay is separate from chat app in china they might have been able to localize their data.
    There will be lesser complications if Whatsapp Pay is a different app than Whatsapp and nothing stops whatsapp from onboarding users to Pay platform.

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