Following a year-long pilot, WhatsApp is now officially introducing a payments utility in India.
The Facebook-owned messaging app is responding to the increased demand for digital payments in its largest market, Reuters reported on Friday (July 26).
“It’s a regulatory approval question in India at this point,” Facebook Chief Executive Mark Zuckerberg said on Thursday (July 25) during the company’s earnings conference.
“We’re also working beyond India in a number of other countries and hope to have this rolled out to a large percent of the people who use WhatsApp within the next year.”
The payments feature was delayed due to increased government scrutiny following erroneous information. The Menlo Park-based firm was also hung up trying to satisfy government regulations calling for localized data storage.
“Payments services are critical ... bringing millions more people into India’s fast-growing digital economy,” Will Cathcart, WhatsApp’s global head, said at an event in New Delhi.
Inexpensive internet access is causing data use to grow fast in India, where WhatsApp has 400 million users, about a third of the population. The government is encouraging more cash users to convert to digital payments.
The digital payment landscape is crowded in India, with competitors like market-leader Paytm, the local app backed by Chinese eCommerce giant Alibaba. Alphabet Inc’s Google Pay, Walmart’s PhonePe, and Amazon Pay also have a foothold in India.
WhatsApp was expected to be a game-changer in India and has a real chance of becoming the leading digital payment player, pushing Paytm aside. Currently, there are more than 1 billion mobile phone users in the country, and the digital payments market is expected to reach $1 trillion by 2023. Despite its popularity, the app has also faced criticism in India, with its messaging service used to spread fake news and rumors, including some that led to almost two dozen lynchings in the country.