WhatsApp Launched in-app payments, Starting in Brazil

WhatsApp has finally added payments in its app, after months of testing and debugging. A few days ago, the Facebook-owned messaging service announced that users in Brazil would be the first to be able to send and receive money by way of its messaging app, using Facebook Pay, the payments service WhatsApp owner Facebook launched last year.
WhatsApp says in its blog post that the payments service — which currently is free for consumers to use (that is, no commission fee taken) but businesses pay a 3.99% processing fee to receive payments will work by way of a six-digit PIN or fingerprint to complete transactions.
You use it by linking up your WhatsApp account to your Visa or Mastercard credit or debit card, with initial local partners including Banco do Brasil, Nubank, and Sicredi. Cielo, a payments processor, is also working with WhatsApp to complete transactions. “We have built an open model to welcome more partners in the future,” it noted.
The news comes as a bit of a surprise. WhatsApp had been testing its payments service among users in India for months (that trial uses another system, not Facebook Pay but UPI), so many assumed that the world’s second-largest internet market would be the debut region for the service.
But Facebook remains stuck in a regulatory maze in India that has prevented it from expanding the payments service beyond a small, limited launch, in what is otherwise the app’s biggest market in terms of users. India has 400 million monthly active users, while the second-largest market Brazil has 120 million MAUs.
(And indeed, it would have an interesting position there because of that size: while there are a number of other digital payments services, including Google Pay and Paytm, there are no clear, large, and popular competitors offering payments within a messaging app in the country.)
WhatsApp had been adopted informally for commercial purposes almost from the very start: small business owners have used it to exchange messages with users around the sale of goods, what is in stock, and so on. But under the wing of Facebook which acquired the company in 2014 for $19 billion WhatsApp started in earnest the big task of bringing in a more formal set of business services.
That’s included the launch of WhatsApp Business, which lets SMBs post catalogs and stock links within the app; advertisers on Facebook also can create links through to their WhatsApp accounts.
But now with payments, WhatsApp, which has amassed over 2 billion users, is finally taking a more comprehensive commercial plunge, giving people not just a place to chat about a product, or even send payment details, but now to actually transact.
And that, in turn, gives WhatsApp and Facebook another shot at building a revenue stream based on its vast scale, one which does not turn the app over to monetize its users through ads and the data that is amassed around them — the primary business model today behind Facebook and Instagram, another major app in the Facebook stable.
“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,” the company said.
This new payment feature will allow users in Brazil to be able to use the payments service on WhatsApp to make purchases from local businesses without leaving their chat, WhatsApp says.