All out war is broke out as Vijay Shekhar Sharma, the founder of Paytm announced that he will request the architect of the country’s Unified Payment Interface system for redressal of what he named as an unjustifiable playing field concurred to WhatsApp, which has begun testing its payments service in the country.
As recently launched WhatsApp experimental service does not require a log-in session and Aadhaar based payments, Sharma said that he will approach the National Payments Corporation of India (NPCI), which has built up the UPI system, and considerably superior authorities to underline this issue.
WhatsApp enjoys the user base of 200 million in India and its entrance into the country’s digital payment space put threats to overturn the pecking order.
"Facebook is openly colonizing our payment system and is customizing UPI to their benefit. UPI was built as an India Stack, now some American monopoly arm-twists UPI for customer implementation," Sharma told ET.
Further, Sharma included that the absence of a login makes WhatsApp payments a security danger, much the same as giving an "open ATM" to one and all. He said, "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. Moreover, he questioned the way that WhatsApp was permitted to begin a pilot with lakhs of customers, while it ought to have been with 5,000-10,000 customers. People who are close to NPCI have said that it will employ all the required features when it goes live for its whole consumer base as expected by the end of March.
Meanwhile, Paytm officials confirmed that Neeraj Arora, WhatsApp’s Vice-President has stepped down from the Paytm Management Board, a position which he held since 2015.
WhatsApp’s entrance, sponsored by Facebook, comes close on the heels of search giant Google’s Tez, making India the pioneer market in the worldwide where the global technology giants such as Amazon are competing for the market share. Sharma clarified that he is not standing firm against overseas companies, but requesting for "a level-playing field" in opposition to opponents. Previously, esteemed at about $10 billion, Paytm recognizes China’s Alibaba, Ant Financial and Japan’s SoftBank as its key investors. "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 official from industry, aware of WhatsApp's payments product has negated the claims of Sharma. "While NPCI has prompted UPI applications to have login sessions, it isn't mandatory. Indeed, even different applications that utilization UPI, similar to Ola and Uber, don't have login sessions," the official stated, adding that a session administration is available in WhatsApp which needs to be customized as per UPI guidelines.
Another official from the payments space said that the security is not a prime concern as the users require their UPI PIN to execute the transaction, moreover, WhatsApp has been offered to improve customer experience which was not permitted to different companies. He added that these features add friction to the customer experience of the apps developed by other companies compared to WhatsApp.
"WhatsApp is auto-creating IDs, not letting me edit and post to a VPA (a UPI handle) easily, not doing a scan and pay in UPI QR codes and it is not interoperable," said an anonymous official.
The digital entrepreneurs were reproachful of Sharma's position.
Amrish Rau, Head of PayU- India, said: "WhatsApp has done a good payments app and other incumbents are just spreading fear." He added, "These are just market gimmicks. WhatsApp is following the usual process for UPI. Spreading rumors is not helping Digital India."
Reacting to the rival’s comments, Sharma said "Paytm is the majority transaction driver of UPI followed by Google. Everyone else is (small)," demonstrating Paytm and Google are the main players who are large enough to matter.
Prasanto K Roy, Vice-President of NASSCOM Internet Council’s said, "I would expect that the core principle of UPI — seamless interoperability (the U stands for Unified!) —will be respected and interoperability will be more clearly and visibly supported by WhatsApp going forward. It is early days and the product is in beta or pilot," among the expectation of there will be a level playing field ahead.