WhatsApp is offering cashback to attract more users to its payment service, days after the messaging platform was allowed by the National Payment Corp. of India (NPCI) to add 60 million more users.
On Wednesday, Reuters reported that the messaging platform is planning to give cashbacks of up to ₹33 for peer-to-peer payments, while a similar incentive is being tested for merchant payments. The rewards will be given in three phases regardless of the size of the transaction. WhatsApp is also planning to test cashback for payments at highway tolls and on utility bills.
“We are running a campaign offering cashback in a phased manner to our users as a way to unlock the potential of payments on WhatsApp. Offering safe, secure, and easy-to-use digital payments is an important part of scaling India’s digital economy, and we’ll continue to drive awareness of payments on WhatsApp as part of our broader efforts to bring the next 500 million Indians onto the digital payments ecosystem,” a WhatsApp spokesperson said in a statement e-mailed to Mint.
WhatsApp added online payments to the messaging app in 2020; but owing to a 30% cap placed by NPCI then, access to its payments service was limited to 20 million users, which was increased to 40 million users in November 2021. With the cashback rewards, WhatsApp hopes to get more users to use its payments service.
India is WhatsApp’s largest market, where it has over 487 million monthly active users as of February 2022, according to Statista data. But, when it comes to payments, the user base is much smaller, due to its late entry into the market and the 30% cap. Currently, the UPI payments market in India is dominated by PhonePe and Google Pay. In March, Google Pay accounted for transactions worth ₹338,873 crore, while the total value of transactions on PhonePe was ₹471,401 crore. WhatsApp had transactions worth just ₹239 crore, as per NPCI data.
The digital payments market in India has seen unprecedented growth, especially after covid-19 outbreak. Ministry of electronics and IT data shows that the volume of digital payments in India grew by 33% year-on-year in FY22.
