Exclusive: WhatsApp rolls out its UPI-based payments feature for more users

Facebook-owned instant messaging app WhatsApp appears to have started rolling out its Unified Payments Interface or UPI-based payment feature for more users, said two sources familiar with the development. 

“NPCI [National Payments Corporation of India] has allowed WhatsApp to onboard more users and possibly its payment feature is now available for all,” said one of the sources on the condition of anonymity. “The formal announcement is likely soon,” the person added.

WhatsApp had expanded the feature to 20 million users in November 2020.

It’s worth noting that NPCI, the regulating body of UPI, lists all third-party apps including WhatsApp on its website and denotes which of them are allowed for limited users with a # symbol pointing to a caveat that it is for limited users only. And WhatsApp had this sign in front of its name on the list till recently.

However, when checked on Monday, we see that NPCI has removed the # symbol from WhatsApp indicating that it is now allowing the Menlo Park-based company to onboard as many users as it can.

Currently, WhatsApp has partnered with four banks — SBI, ICICI, HDFC and Axis Bank — to process payments through UPI. 

Queries sent to WhatsApp and NPCI did not elicit an immediate response. We’ll update the post in case they do.

This development comes at a time when WhatsApp announced the appointment of Manesh Mahatme as the head of its payments segment in India.

Mahatme, who joined the company from Amazon where he spent close to seven years as director of Amazon Pay India, will focus on scaling WhatsApp’s payment business in India. 

It took WhatsApp more than two years to launch its payments feature in India. The company had to go through a stringent process to comply with the data localisation rules made by the Indian government.

Despite being allowed for 20 million users, WhatsApp Pay has not been able to gain traction in the last six months. According to NPCI data, it has recorded a mere 0.51 million transactions amounting to Rs 48.15 crore in May and never crossed 1 million in volume since November 2020.

The top three players — PhonePe, Google Pay and Paytm — control more than 90% market share in the UPI ecosystem. As of May 2021, PhonePe was leading the list with a 45.27% market share followed by Google Pay and Paytm with 34.67% and 11.44% share respectively.

The full and formal entry of WhatsApp in the payments space, which has 530 million users in India, is likely to change UPI's current stats in the coming months.