On Thursday (November 5, 2020), the National Payments Corporation of India (NPCI) gave its approval for WhatsApp to Go Live on Unified Payment Interface (UPI) in the multi-bank model.
In the year 2008 National Payments Corporation of India (NPCI) was incorporated as an umbrella organization for operating retail payments and settlement systems in India and
was created for a robust payment and settlement infrastructure in the country.
The National Payments Corporation of India (NPCI) allowed the Facebook-owned messaging platform WhatsApp to start its payments service in the country in a "graded" manner.
WhatsApp has 400 million users in India and had begun its pilot run two years ago and waited for regulatory clearances to launch its UPI-based payments in India.
National Payments Corporation of India (NPCI) issued two separate statements on WhatsApp and on limiting the transaction volumes
National Payments Corporation of India (NPCI) in one statement said that WhatsApp can expand its u Unified Payment Interface (UPI) ser base in a graded manner starting with a maximum registered user base of 20 million in UPI.
National Payments Corporation of India (NPCI) in another statement said that capped the share of the total number of transactions that a third party application can process at 30 percent of the total volume of transactions processed in UPI which will be effective from January 1, 2021.
The NPCI had earlier notified the Reserve Bank of India (RBI) that WhatsApp had met data localization requirements
National Payments Corporation of India (NPCI said that with UPI reaching 2 billion transactions a month and with potential for future growth, it has issued a cap of 30 percent of the total volume of transactions processed in UPI, which is applicable on all Third-Party App Providers (TPAPs).
The 30 percent cap will be determined on the basis of the total volume of transactions processed in UPI during the preceding three months (on a rolling basis).
Existing TPAPs who have surpassed the cap will have a period of two years from January 2021, to comply with the same in a phased manner.
The third-party applications such as Google Pay, PhonePe, Paytm, and Amazon Pay are currently dominating the UPI ecosystem that controls the majority of the transactions.
Furthermore, UPI recorded over 2 billion transactions in October, which is a milestone that highlights the speedier adoption of digital payments in a post-COVID-19 world. UPI was launched in 2016 and it had crossed 1 billion transactions for the first time in October 2019.
While it took UPI three years to reach a billion transactions in a month, the next billion came in just a year.
