Update: Despite the new tweaks to the user interface, Whatsapp payments to other UPI IDs doesn’t work. We tried to send money using different WhatsApp accounts to other UPI accounts and every single time the transaction failed. The update seems to be more cosmetic than actually functional.
As an example, I tried to test this feature and attempted to send some money to my Dad who is not on Whatsapp payments but has a UPI ID he created on Google Tez. I tried twice using both the above-mentioned methods and both attempts failed. I got a message saying that the transaction couldn’t be completed and my bank account was not debited. (Screengrab below)
Original story: Whatsapp has tweaked its payments interface to make the ‘send to UPI ID’ option more visible and accessible. This seems to be an effort by the Facebook-owned company to address the woeful lack of interoperability (a key selling point of UPI) on its app.
The update adds two ways for a user to send money over UPI even if the recipient is not using the Whatsapp payments feature. First, the user can visit payments tab in the settings area and choose the ‘Send Payment’ option. Apart from showing a user’s contact list Whatsapp now displays a ‘Send to UPI ID’ option at the top.
When a user attempts to send money to someone, who doesn’t have Whatsapp payments enabled, over chat a ‘Send to another UPI ID’ option is now visible as well.
Still no password or app lock
Most UPI apps use the mobile number as a login, and Google TEZ and PhonePe both have additional passwords/pattern locks for logging in, over and above the UPI pin required for payments. Friction is a necessary inconvenience for security in payments, and you can’t do away with it, especially in a country where mobile phones get changed and stolen easily, numbers get changed. Whatsapp might want to make payments easier, but this can’t come at the cost of compromising users. There are still no signs that Whatsapp plans to add this security step.
Whatsapp’s controversial payments launch
Whatsapp launched its UPI-powered payments service in India last month to some anger over its lack of interoperability and alleged disruption of an ‘open’ system. (The openness of UPI is up for debate.)
Following the launch, incumbent payment services in India felt Whatsapp was playing by its own rules. Most vocal among them was the PayTM CEO, Vijay Shekhar Sharma. In an interview with CNBC Sharma said, “Whatsapp is killing India’s ‘beautiful, open UPI system’, and that it has gotten preferential access to UPI. He says that “it does not allow transactions to non-Whatsapp UPI handles, UPI handles created via other apps, does not include passwords and logins, and QR code scanning. Everyone else has 3 factors of authentication: login, password and then UPI pin. Whatsapp doesn’t have login and password.”
The National Payments Corporation of India (NPCI) then released a statement responding to the controversy where they said the Whatsapp rollout was a “beta launch with a limited user base of 1 million and low per transaction limit.”
This was the first we heard of “beta rollout” for any UPI application. While features have been added post-launch, the basic framework has been in place for launches by other players (Tez or PhonePe for example). And calling a one million user rollout “beta” sounds a little silly and there is no explicit mention of the “low transaction limit” on the app. With over a 200 million monthly active user base we have serious doubts that the feature can only be accessed by only a million users, so when is the ‘beta launch’ coming to an end and when are we getting a stable release?