WhatsApp Pay to expand UPI services to user base in India

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WhatsApp Pay, a payment feature enabling users to send and receive money directly within the WhatsApp chat interface, can now offer Unified Payments Interface (UPI) services to its entire user base in India. National Payments Corporation of India (NPCI), responsible for operating retail payments and settlement systems in India, has removed the UPI user onboarding limit for WhatsApp Pay, a third-party app provider. 

“Previously, NPCI had permitted WhatsApp Pay to expand its UPI user base in a phased manner. With this notification, NPCI is removing the limit restrictions on user onboarding on WhatsApp Pay,” NPCI said in a statement. 

WhatsApp Pay shall continue to comply with all existing UPI guidelines and circulars applicable to existing TPAPs or Third-Party Application Providers. TPAPs are organizations that provide applications or platforms that allow users and merchants to send and receive UPI payments.

WhatsApp Pay, Meta’s (NASDAQ: META) UPI-based payment service, integrates effortlessly with other UPI apps such as PhonePe, Google Pay (GPay) (NASDAQ: GOOGL), and Paytm, allowing users to connect with anyone on their contact list, regardless of the payment app they use. With UPI interoperability, WhatsApp Pay also enables users to send money to individuals on other platforms like PhonePe or GPay, ensuring smooth payments without concerns about app compatibility.

The removal of the UPI onboarding limit for WhatsApp Pay enhances the accessibility and convenience of UPI payments for a broader audience while also establishing WhatsApp as a key player in India’s digital payments landscape. 

As of December 2024, the instant messaging platform’s total Indian user base reportedly stood at about 596.6 million, which is the largest user base for Whatsapp in the world. 

Several factors contribute to WhatsApp’s popularity in India. First, it is cost-effective, requiring only a basic mobile data plan. Second, its user-friendly interface makes it easy for even those with limited smartphone experience to use. Finally, as most smartphone users in India have Android devices, WhatsApp naturally becomes the preferred messaging app.

NPCI allowed WhatsApp Pay to gradually expand its UPI user base in India. In 2020, NPCI initially set a user cap of 1 million for WhatsApp Pay, which was increased to 100 million by November 2022. So far, WhatsApp Pay was reportedly working with nearly 51.1 million users, which accounts for about 10% of its total user base.

The initiative is especially significant at a time when UPI is already the most popular digital payment method and is likely reaching a saturation point, leaving little room for further development. However, reaching a saturation point may not necessarily signal the end of UPI’s growth; instead, it is likely to drive further technological advancements, like international expansion. 

India is looking to expand UPI use across the world so that any Indian with a UPI account can make a payment using UPI globally. So far, UPI has expanded to the United Arab Emirates (UAE), Peru, Mauritius, Sri Lanka, Singapore, France, Bhutan and Nepal. In 2025, UPI may expand to another four to six countries. 

UPI is widely used across all sectors, from street vendors to large shopping malls, and holds the highest share of global digital transactions. Serving approximately 350 million individuals and 50 million merchants, UPI has experienced a tenfold increase in transaction volume over the past four years, growing from 12.5 billion transactions in 2019-20 to 131 billion transactions in 2023-24, accounting for 80% of all digital payment volumes.

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