Whatsapp’s In-App payment feature: WhatsApp has finally pulled the trigger on payments inside its app after months of talks and trials. The Facebook-owned messaging service today revealed that users in Brazil will be the first to be able to send and receive money via its messaging app. WhatsApp integrated Facebook Pay, the payment service that was introduced last year by WhatsApp owner Facebook.
WhatsApp says in its blog post that the payments service is currently free for consumers to use means, no commission fee taken. Generally, businesses pay a 3.99% processing fee to receive payments. WhatsApp said they are using a six-digit PIN or fingerprint system to complete transactions.
Brazil users can use it by linking their WhatsApp account to the credit or debit card (Visa or Mastercard), with initial local partners including Banco do Brasil, Nubank, and Sicredi. Payment processor Cielo also works to complete transactions with WhatsApp. “We’ve developed an open platform in the future to accept more partners,” the blog stated.The news comes as kind of a surprise. WhatsApp had been testing its payment service among users in India for months (that trial uses another method, not Facebook Pay but UPI), so many thought the company’s debut area will be the world’s second-largest Internet market.
But Facebook remains trapped in India ‘s regulatory maze, which has stopped it from expanding the payment method beyond a small, restricted launch, in what seems to be the largest consumer market for the app. India has 400 million monthly active users, though Brazil has 120 million MAUs, WhatsApp’s second-largest market.
WhatsApp was adopted informally for commercial purposes almost from the very beginning: it was used by small business owners to exchange messages with users about selling goods, what’s in stock, and so on. Yet under the leadership of Facebook — which bought the company for $19 billion in 2014. WhatsApp began the big challenge of putting in a more structured range of business services in practice.
It included the release of WhatsApp Business, which allows SMBs to post catalogs and stock links inside the app. Facebook marketers can also connect to their WhatsApp accounts.
But now with payments, WhatsApp, which has accrued more than 2 billion users, is finally taking a more detailed commercial leap, giving people not only a place to talk about a product, or even submit details of the payment, but to actually transact.
So this, in turn, gives WhatsApp and Facebook another shot in creating a vast-scale revenue stream that doesn’t hand the platform over to monetize its users through advertising and the data that’s collected around them.
The company said, “Payments on WhatsApp are beginning to roll out to people across Brazil beginning today and we look forward to bringing it to everyone as we go forward.”
They further said that users in Brazil will be able to make purchases from local businesses using the payment service on WhatsApp without leaving their chat.
In the blog-post company said, “The over 10 million small and micro-businesses are the heartbeat of Brazil’s communities. It’s become second nature to send a zap to a business to get questions answered. Now in addition to viewing a store’s catalog, customers will be able to send payments for products as well.”
While WhatsApp has been working on payments for years in theory; from what we understand there have been a lot of delays in part because of how and where Facebook wanted WhatsApp to implement it. Now that it’s launching with Facebook Pay, we seem to know how the struggle landed.
As for subsequent regions to launch the service, it is not clear if Facebook will be open to collaborating with other payment systems, or even other payment rails outside Facebook Pay. Although the Indian trial, using UPI, suggests that it will not be just a one-size-fits-all solution.
A WhatsApp spokesperson declined to say more when asked for more specific details about future plans beyond. Facebook CEO Mark Zuckerberg quoted “More to come soon!”.
A Facebook spokesperson said, “We’re continuing to roll out Facebook Pay on Facebook to more countries outside the U.S. for existing payment experiences, which vary by country and may include experiences such as in-game purchases and fundraisers where already available.”.
He further quoted, “As we’ve said previously, our goal is to bring Facebook Pay to more people and places over time.”