In a major step-up for its payments business, WhatsApp has received the approval from National Payments Corporation of India to open UPI services on its messaging platform to 100 million users. Earlier WhatsApp Pay had been allowed to extend payment services to 40 million users.
“National Payments Corporation of India (NPCI) has approved an additional sixty (60) million users on UPI for WhatsApp. With this approval, WhatsApp will be able to expand the service to its hundred (100) million users,” NPCI, which runs UPI, said in a statement.
WhatsApp, the most popular instant messaging application in the world, had started testing its payment services based on Unified Payments Interface (UPI) back in 2018. The service was formally launched in 2020 after the Meta-owned messaging platform ensured compliance with regulations, including storage of transaction data locally.
At the time of launch, WhatsApp Pay was allowed to be rolled out to only 20 million users in India. This number was then increased to 40 million last year. The allowed user base has now been increased by 60 million to a total of 100 million.
The current limit on user base for WhatsApp Pay in India still remains way below the total number of subscribers the messaging application has in the country. WhatsApp has over 400 million users in India, making the nation its largest market in terms of subscriber base.
UPI has emerged as one of the most popular payment methods in India, especially after the 2016 demonetisation of high-value currency notes which spurred digital transactions in the country. In March 2022, over 5.4 billion transactions worth ₹ 9,60,581.66 crore were registered on the payments platform.
The market in UPI ecosystem is dominated by PhonePe and Google Pay, with 49% and 35% market share in March, respectively. Both players registered transactions worth ₹471,401.26 crore and ₹338,873.25 crore during the month. WhatsApp Pay, with its 40 million users, managed transactions worth ₹239.78 crore.
While India is WhatsApp’s largest market, its WhatsApp Pay service remains underused in the country. The company is yet to launch a widespread marketing campaign for the feature. The company has been requesting NPCI to remove limits on subscriber base, but the authority has been apprehensive of the plea on account of stress on India’s financial infrastructure.
Given its popularity, UPI has also been incorporated in avenues other than just person-to-person transactions. During the latest monetary policy announcement, RBI governor Shaktikanta Das said that cardless cash withdrawals will be allowed at all banks and ATMs in future. The feature is currently offered by a few banks for their customers at their ATMs. The central bank is now looking at expanding the service to ensure interoperability in UPI-based cardless cash withdrawal.
Recently, markets regulator Securities and Exchange Board of India (SEBI) increased the limit of bids retail individual investors can place for public issues through Unified Payment Interface (UPI) to ₹5 lakh. from the earlier limit of ₹2 lakh. NPCI had modified the limit in December 2021.