WhatsApp trial service launched in India last week does not require a log-in session and Aadhaar-based payments. Vijay Shekhar Sharma said he will approach the National Payments Corporation of India (NPCI), which has developed the UPI system, and even higher authorities to highlight this issue.
Vijay Shekhar Sharma, the founder of India’s largest digital payments company Paytm, will petition the architect of the country’s unified digital payment system (UPI) for redressal of what he termed as an unfair playing field accorded to messaging service provider WhatsApp, which has begun testing its payment service in the country.
Owned by Facebook, WhatsApp boasts a monthly user base of 200 million in India and its entry into the country’s digital payment space threatens to upend the pecking order.
“Facebook is openly colonising our payment system and is customising UPI to their benefit. UPI was built as an India Stack, now some American monopoly arm-twists UPI for customer implementation,” Sharma told ET.
Sharma added that lack of a login makes WhatsApp payments a security risk, akin to giving an “open ATM” to everyone. “How can you give such a security risk just in the name of underwriting that banks have given. WhatsApp is used by gullible Indian consumers far more than any other application in this country,” said Sharma.
WhatsApp’s entry, backed by deep pockets of Facebook, comes close on the heels of search giant Google’s launch of its payments service Tez last year, making India the first market in the world where the global technology giants including Amazon are competing for market share.
Sharma clarified that he is not taking a stand against overseas companies, but asking for “a level-playing field” against competitors. His firm, last valued at about $10 billion, counts China’s Alibaba and Ant Financial besides Japan’s SoftBank as key shareholders.
“This is not about Indian companies versus international companies. India is an open internet economy that welcomes every company that plays fair,” he said.
An industry executive aware of WhatsApp’s payments product has rebutted Sharma’s claims. “While NPCI has advised UPI apps to have login sessions, it is not compulsory. Even other apps that use UPI, like Ola and Uber, don’t have login sessions,” the person said, adding that WhatsApp has a session management in its app which needs to be customised to UPI guidelines.
“WhatsApp is auto creating IDs, not letting me edit and post to a VPA (a UPI handle) easily, not doing scan and pay in UPI QR codes and it is not interoperable,” said this executive on the condition of anonymity.
“WhatsApp has done a good payments app and other incumbents are just spreading fear,” said Amrish Rau, India head of global payments firm PayU. “These are just market gimmicks. WhatsApp is following the usual process for UPI. Spreading rumours is not helping Digital India,” he added.
In a response to comments made by rivals, Sharma said that his company along with Google’s Tez are the only players who are large enough to matter.
“Paytm is the majority transaction driver of UPI followed by Google. Everyone else is small,” he said.