Will WhatsApp be a curse or boon for Paytm, Mobikwik and other e-wallets?
WhatsApp may soon launch a new product in India called WhatsApp for Business that may include wallet or payments systems to make the app more useful for Indians.tech Updated: Feb 25, 2017 17:20 IST
Facebook-owned WhatsApp may soon launch either a new digital payments system or a peer-to-peer money transfer feature in the country, sources in the Indian government and a large wallet company has said.
“WhatsApp’s co-founder Brain Action met government officials on Friday and as per discussions the company is looking at launching a new digital payments system in the country,” a senior government official told Hindustan Times, adding, that the government would keep a close watch of the companies activities after the Free Basics imbroglio.
“The government, which is willing to see the product, will approve after seeing it and ensures that it meets all the standard requirements and regulatory aspects,” he said.
Free Basics -- a Facebook programme -- that was launched by the Mark Zuckerberg-promoted firm to provide internet to millions of Indians was banned in the country around the first week of February last year as it was found to be flouting norms of net neutrality.
The campaign against Free Basics was supported by many including Vijay Shekhar Sharma, founder and chief executive of India’s largest digital wallet company Paytm and Nandan Nilekani, former Infosys CEO and first chairman of Unique Identification Authority of India (Aadhaar). Sharma asked fellow Indians to either choose Free Basics and do a jihad for independent internet later or pick net neutrality while Nilekani called it a ‘walled garden’ that is against the spirit of openness on the internet.
WhatsApp India didn’t directly respond but Brian Acton, Co-Founder, WhatsApp , told HT in an email statement that “India is a very important country to us, and we’re proud to have 200 million people who use WhatsApp to connect with their friends, family and communities.”
“We build every WhatsApp feature to be simple, reliable, and secure, and this vision is in line with what Digital India promises to achieve. We will continue to invest so we can help more people across India, and we hope to contribute more to India’s vision for digital commerce in the future.”
But if WhatsApp does come in with a new payments ecosystem, then large wallet companies such as Paytm and Mobikwik might see tough competition from WhatsApp as the app is one of the most popular and engaging apps in the country.
But a top executive of a large wallet company claims that the entry of WhatsApp might actually be helpful for wallets as he believes that WhatsApp is “more likely” to partner with companies such as Paytm and Mobikwik in order to roll out the new feature.
“I don’t think WhatsApp will bring in something new as it doesn’t have a payments bank licence yet and is more likely to partner with wallet firms to rollout its solution which again might be peer-to-peer payments rather than peer-to-merchant,” he said adding that WhatsApp has been in conversation about the same with his company.
“Going peer-to-merchants needs a lot of experience, investment in terms of resources and WhatsApp might not want to get involved in all these areas,” he explained.
Another source from the same company speculated that WhatsApp might emulate the WeChat model from China where the video-based chat app started with peer-to-peer payments and then moved to merchants.
On the other hand, experts believe that WhatsApp may tie up with Airtel for the new payments system. Interestingly, Airtel very recently had launched its Airtel payments bank platform.
Paytm has declined to comment on the issue.