According to two insiders, WhatsApp will roll out cashback awards to entice more Indians to use its peer-to-peer payments service, and is testing similar incentives for merchant payments as it competes with rivals such as Google.
The latest step comes just days after WhatsApp received regulatory approval to more than expand its payments service to 100 million users in India, the company’s largest country with over half a billion users. find out more
WhatsApp will launch a reward offer of up to 33 Indian rupees ($0.40) for transactions users make on its payments service, which allows contacts to give each other money from within the messenger app, according to sources with direct knowledge of the company’s intentions.
In what one insider described as WhatsApp’s “user acquisition push,” the incentive, which would be spread across three transactions, will be granted regardless of the amount being transferred, even if it is as small as 1 Indian rupee.
The payback may appear insignificant, but Neil Shah, vice president of research at Counterpoint Research, believes it will be a “compelling enough” reason for users to switch to WhatsApp.
“As an Indian, you won’t leave money on the table,” Shah remarked.
WhatsApp stated in a statement in response to a Reuters enquiry that it is “conducting a campaign delivering cashback incentives to our users in a gradual approach as a means to unlock the potential of payments on WhatsApp.”
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Separately, WhatsApp is piloting a scheme in which it will give cashback incentives to customers who pay highway tolls, electricity bills, and other expenses directly from the app, according to the two people.
According to the sources, WhatsApp also plans to explore such incentives for customers making mobile payments for Reliance Jio, India’s largest telecom operator. WhatsApp’s parent company, Meta, spent $5.7 billion in the Indian firm’s digital unit in 2020, and Reliance is a partner.
WhatsApp did not react to a request for comment on these plans, and Reliance did not answer to a request for comment as well.
The payback push comes after WhatsApp performed an internal research in India in June 2021 to gauge competition. According to the “Winning from Behind on India Payments” research, which was seen by Reuters,
WhatsApp has also determined that it has to expand beyond peer-to-peer payments, since users are increasingly using competing applications to make merchant and bill payments, which, according to the study, will make WhatsApp a “more appealing proposition (for users) to switch over.”
In India’s congested digital payments sector, WhatsApp competes with Google Pay, Ant Group-backed Paytm, and Walmart’s PhonePe.
WhatsApp’s expansion has been hindered because India has banned the number of customers to whom it may offer its payments service for months, fearing that doing so would put the country’s financial infrastructure under duress.
