NPCI gives approval for WhatsApp to ‘Go Live’ on UPI in a graded manner

WhatsApp can finally launch services on the United Payments Interface (UPI), a payment platform created by Indian banks, in a major boost for the Facebook-owned app in its biggest market.

The National Payments Corporation of India (NPCI), India’s flagship payments processor, permitted WhatsApp to go live on UPI.

WhatsApp can expand its UPI base in a graded manner starting with a maximum number of registered users at 20 million, the NPCI said in a statement late on November 5.

WhatsApp’s payment service in India has long remained stuck because of regulatory and legal hurdles. It has been operating within a limited set of users in India, but multiple regulatory challenges and litigation issues have delayed its full launch.

WhatsApp’s popularity in India poses a threat to established players, but it is entering a fiercely competitive and crowded market that has the likes of Google, and Alibaba and Softbank-backed Paytm providing a gamut of payment services.

Notably, cashless transactions in India got a big boost after Prime Minister Narendra Modi banned high-value currency notes in late 2016.

The move comes on the same day the NPCI announced that third-party app's transaction volume in UPI will be capped at 30 percent.

The NPCI said since UPI has been reaching two billion transactions a month and has potential for future growth, a 30 percent cap has been put on its total volume of transactions. This will be applicable on all Third Party App Providers (TPAPs).