WhatsApp is releasing its payment service after a two-year-long beta testing on the Indian market. It is expected to go live by end of May 2020. Currently WhatsApp has a userbase of approximately 40 Crore people in India. After the launch, WhatsApp pay will instantly become the largest UPI service provider in the market. In this article, we will discuss future prospects of WhatsApp Pay, a potential disrupted, and may eat up the market share of existing players such as PhonePe, Google Pay & PayTM.
The news of WhatsApp Pay came just 3 weeks after the Reliance-Facebook deal took place. One interesting part of the deal was that, reliance owned Jio Mart will integrate WhatsApp, and both of them will work together on providing technology infrastructure to local Kirana stores. We predict WhatsApp pay will play a huge role in this game, although no one has a clear picture of what the Tech-giant and Indian Conglomerate are planning. Let’s have a look at the possibilities.
Digital payment market in India
Today the digital payment market is dominated by 3 mobile apps – PhonePe, Google Pay, and PayTM. The features offered by all these players are similar and competing. Apart from the UPI, there is another kind of digital payment service in form Wallets, which is slowly declining after the KYC mandate from RBI. Some of the prominent players in Wallet space are PayTM, Ola Money, Freecharge, Vodafone M-Pesa, etc.
UPI transactions are on a massive growth trajectory since its inception in 2016. Last year, we saw a growth rate of 213% in UPI transactions and this year it is expected to rise by another 26.6% inspite of the ongoing worldwide recession due to COVID-19.
Impact of WhatsApp Pay
I have made some predictions about how WhatsApp Pay will be adopted in the Indian business ecosystem. Kindly note that these predictions are speculative in nature, hence should not be considered as hard facts.
Payments integrated to conversations:
After the launch of WhatsApp Business in 2018, Indian business owners have been proactive to integrate the service with their business processes. Today more than 5 million businesses are using WhatsApp business. I predict WhatsApp Pay will become an integral part of the business offering by WhatsApp. Very soon, you will have these kinds of conversations with your Kirana shop owners:
Simplicity & Convenience
WhatsApp is well known for its simple platform which makes it easy to use for people who are technologically challenged(Senior citizens, Non-tech savvy folks). With WhatsApp pay, we are expecting a higher level of intuitiveness and convenience compared to the likes of Google Pay. Here is how clean the WhatsApp Pay looks like:
This is one thing I have been hearing a lot. Very soon, WhatsApp may come up with microlending on top of the money transfer service. PayTM has already offered both business and personal loan facility as part of its service portfolio. However, when WhatsApp will do it, you will see more simplicity in the lending process. My guess is after this ongoing Corona pandemic is dealt with people will need a lot of credit to get started again with their day to day obligations and WhatsApp will play a major role in this.
Banks are already WhatsApping
Major banks have already started sending notifications and alerts to customers via WhatsApp. This is done through a feature called WhatsApp Business API. When WhatsApp will come up with its own banking services, it would be interesting to see how banks will react, as it would be a case of conflict of interest.
With the advent of WhatsApp Business, Messenger Chatbots, and Google assistants, consumers are slowly becoming conversation oriented. They do not want to visit your website nor they want to download your app, they simply want to have a conversation with your brand.
When transactions come embedded inside conversations we call that Conversational commerce. WhatsApp Pay will bring a huge possibility for businesses by interlinking payments and chats.
To wrap up this crazy speculation, I would say WhatsApp is the next big thing in Indian market. For 10 years WhatsApp was waiting for right opportunity to encash its platform and now they are just getting started. For 10 years, Indian people were getting used to the messaging app, now their day to day life depends heavily on it.
We are going to witness a lot of convenience for consumers and an expansion in the service portfolio under WhatsApp business. Both consumers and businesses should be excited about it and must embrace the change.
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