WhatsApp Pay vs Paytm: NPCI says interoperability must to roll out UPI app

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The statement was defence against allegations levelled by Paytm’s Vijay Shekhar Sharma of NPCI supporting WhatsApp during beta launch of its UPI-based payments service.

New Delhi: The National Payments Corporation of India (NPCI) will allow the full-scale public launch of any Unified Payments Interface (UPI)-enabled app only if the app fulfils the principles of interoperability, it said in a statement on Friday.

The statement was a defence against allegations levelled by Paytm founder Vijay Shekhar Sharma of NPCI supporting messaging app WhatsApp during the beta launch of its Unified Payments Interface -based payments service.

The principles for interoperability in essence include the ability to send and receive money through any Unified Payments Interface ID and generate a BHIM/Bharat QR code, said NPCI.

BHIM stands for Bharat Interface for Money.

“Currently, NPCI has given its consent to roll out WhatsApp BHIM UPI beta launch with limited user base of 1 million and low per-transaction limit. Four banks will join the multi-bank BHIM UPI model in phases (in the coming weeks) and full feature product shall be released after the beta test is successful,” the statement said.

The multi-bank model offers advantages such as transaction load distribution between banks and helps to integrate popular apps easily with UPI, the statement added.

On Wednesday, Sharma in a tweet alleged that Facebook, which owns instant messaging app WhatsApp, was flouting the rules of a level playing field. “After failing to win war against India’s open Internet with cheap tricks of free basics, Facebook is again in play. Killing beautiful open UPI system with its custom close garden implementation. I am surprised, champions of open @India_Stack, let it happen!”

Messages and emails sent to Facebook remained unanswered at the time of going to press.

NPCI said it follows well-defined guidelines for UPI services with the objective of making the platforms interoperable and based on open standards. The purpose is to offer convenient and secure offerings, providing multiple choices to consumers for rapid adoption of digital payments, its statement said.

Reacting to NPCI’s statement, a Paytm spokesperson said, “We welcome this statement by NPCI. It addresses the concerns of interoperability violation that we had raised. It also clarifies that the trial has been restricted to 1 million users, though we feel that a product with the stated violations could have been tried out among a much smaller base.”

The spokesperson went on to add: “We are still concerned that this statement is silent on the critical issue of safety/security of a financial transaction through UPI, where consumers need to mandatorily sign in… This statement is also silent on other issues such as the requirement to send SMS notifications for every UPI transaction. We hope that future rollout will be fully compliant with all the guidelines.”

UPI is a payments system launched by NPCI in August 2016 that facilitates instant fund transfer between two bank accounts on a mobile platform.

There are more than 200 million WhatsApp users in India, claims the company.

Paytm has a base of more than 310 million registered users and 6 million offline merchant are already on board, claims the company.

Transactions across UPI reached a new peak in January. The transaction volume was 151.7 million, up around 4% from 145.5 million in the previous month. The value of transactions rose around 18% to Rs155.4 billion in January from Rs131.4 billion in the previous month, according to provisional data released by RBI for the month of January. Out of this, Bharat Interface for Money (BHIM) accounts for 9.57 million transactions, amounting to Rs 3.65 billion.

Transactions through UPI received a major boost from the government after Prime Minister Narendra Modi launched the BHIM app on 30 December 2016. Until now, there have been more than 22.7 million downloads of the app on the Android platform and around 1.10 million downloads on the iOS platform.

UPI was launched in August 2016 with 21 banks, and is currently being offered by about 71 banks.

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