After months of talks, speculations and trials, Facebook group subsidiary, WhatsApp messenger, has finally activated its payment feature. Last week, the company announced that it had launched the feature which would see users send and receive money, starting with Brazil.
In an official blog post, says that the services id currently free for consumers, i.e. there will be no transactions fees on transfer, but businesses would have to pay a processing fee of 3.99% to receive payments. It also adds that for purposes of transaction security, there is a 6-digit PIN required couple with finger print to ensure the completion of transactions.
The WhatsApp payments system works by linking it with your Visa or Master credit or debit cards, with the local Brazilian partners being Banco do Brasil, Nubank and Sicredi. Cielo, a payments processor that also works to ensure the completion of WhatsApp payment transactions.
It was Supposed to be India, What Changed?
WhatsApp has been testing this feature in its Indian market for months now, and it uses other UPI system for its trials, not the current Facebook Pay. As such it is a surprise that the service debuted in Brazil and not India.
It appears that the reason for choosing Brazil over India is because Facebook has been stuck in a regulatory maze in India over the last couple of months. This caused the company to choose Brazil over India where it has its biggest market of over 400 million monthly active users. Brazil comes in a distant second with about 120 million monthly active users.
It would have been quite interesting to note the successes and challenges if the service at first launched in India, considering the sheer market size and existing competition with Google Pay and Paytm already present in the market there offering messaging app payment service.
Even prior to the launch of this service, WhatsApp had been adoption informally as a medium of business transactions; small business owners have used it to exchange messages around the sale of goods and services around the world. It however started to take a serious look at offering official business services after it was acquired by Facebook for $19 Billion in 2014.
The takeover by Facebook led to the launch of services like WhatsApp Business, which allows SME’s post catalogues and stock links within the app. It also created a channel for Facebook advertisers to directly link their Facebook pages with their WhatsApp messenger app.
With a current user base of over 2 billion people globally, WhatsApp appears to be going fully commercial by going beyond just providing a messaging platform, but also providing a full business suite platform. And this will obviously be a revenue stream booster for the Facebook group in the long run.
“Payments on WhatsApp are beginning to roll out to people across Brazil beginning today and we look forward to bringing it to everyone as we go forward,” the company said.
This WhatsApp payments feature ensures that users in Brazil can make payments directly to sellers within their chat window without the need to leave the chat to use a third-party payment app.
“The over 10 million small and micro businesses are the heartbeat of Brazil’s communities. It’s become second nature to send a zap to a business to get questions answered. Now in addition to viewing a store’s catalog, customers will be able to send payments for products as well,” the company added in its official blog post.
The questions remain as to when will this payment service be made available in other markets, especially in emerging market places like Africa. Additionally, it will be interesting to see how the bank card feature will work in places like Africa where not many people have access to debit or credit cards. Will Facebook incorporate the more famous mobile money payment feature that Africans are more inclined to as opposed to bank cards? And will the market ditch the already existing simple and convenient mobile money system for WhatsApp payment? These and many more questions remain to be answered.
Random African loves writing about the African continent. He is consistently in touch with happenings in every part of the continent and derives joy from providing fresh and crisp information for his audience.