The National Payments Corporation of India (NPCI) on April 13 allowed WhatsApp to enable Unified Payments Interface (UPI) service to an additional 60 million users from its current limit of 40 million.
The WhatsApp UPI payments service was activated in November 2020, initially for 20 million users, and was later raised to 40 million users in November 2021. Now, with a further 60 million users, the total user base of WhatsApp UPI can be 100 million.
WhatsApp UPI A Small Slice Of Big Pie
As per NPCI data, WhatsApp UPI processed 2.54 million transactions worth Rs 239.78 crore in March 2022. Overall, a total of 5,405.65 billion transactions were processed via UPI worth about Rs 9,60,582 lakh crore. So, in comparison to the overall numbers, WhatsApp accounts only for about 0.05 per cent of the total UPI transactions in terms of volume for March 2022. Its share in value is even lower: 0.025 per cent of the total UPI transactions in terms of value.
When compared to other apps, WhatsApp UPI’s share is still small. During financial year 2022, WhatsApp UPI processed transactions worth Rs 1,385 crore. In comparison, India’s leading UPI app, PhonePe, processed Rs 39.78 lakh crore worth of UPI payments. One of the reasons is that WhatsApp has not yet aggressively pushed its UPI product, unlike its competitors, despite having more than 481 million registered users.
Single Third-Party UPI App Cap
In October 2020, when UPI transactions crossed the 2 billion mark, NPCI announced that to curb monopoly in transaction processing and ensure a fair playing field in the UPI ecosystem, no third-party UPI app providers will have more than 30 per cent share of transactions. This limit of 30 per cent is calculated on the basis of the total volume of transactions processed on the UPI network during the preceding three months by a third-party app on an ongoing rolling basis.
“Upon breach of threshold(s), basis request by a third-party app provider through their PSP (payment service provider) banks, there will be a provision to exempt the players to some extent when the volume cap is reached. Such exemption may last maximum of up to six months unless specifically further extended,” NPCI had stated in a press release.