whatsapp

This photo illustration taken on March 22, 2018 shows apps for Facebook, Instagram, Whatsapp and other social networks on a smartphone in Chennai. (Arun Sankar/AFP/Getty Images)

NEW DELHI — Union IT and Telecom Minister Ravi Shankar Prasad July 26 said if the global messaging company WhatsApp meets the regulatory norms from RBI and National Payments Corporation of India, then it should be allowed to start digital payment operations in the country.

Prasad had a meeting with Whatsapp CEO Will Cathcart where the minister said WhatsApp has 400 million reach in India while Facebook has already 300 million subscribers in the country. Facebook is a social networking company and is the parent of Whatsapp.

"They (Whatsapp) are going into digital payment also in accordance with the RBI architecture and NPCI requirements. I have heard them and have instructed my departments to encourage them if they comply. If they meet the regul atory requirements, they must be encouraged," the minister said.

WhatsApp is in the process of rolling out payments service in India this year. Payments through WhatsApp were introduced on beta testing phase to a million users in February last year. The service is based on the Unified Payments Interface standard developed by the NPCI.

It is nearly a necessity for Whatsapp to launch the payment service as it is in direct competition with giants like Alphabet's Google Pay, Walmart-owned PhonePe, Amazon Pay and Alibaba-backed Paytm. These companies are in a fierce competition to dominate the digital payments space in the country which is at a nascent stage.

The Central government has raised several concerns over the authentication mechanism used by the service and also compliance with the Reserve Bank of India's data localization norms.

WhatsApp had earlier said it had built a local system to store payments-related data to comply with the RBI's data localization requirement, but later in an affidavit submitted to the Supreme Court, RBI said WhatsApp's Pay is yet to comply with its data localisation norms.

Later Whatsapp informed the Supreme Court that the trial run would likely be over by July and that it would not launch payments services without fully complying with the RBI's norms.

The Minister also said he has flagged three concerns to them. "They have told me that they have set up an Indian-specific office and I have told them that they must appoint India-specific grievance officer to look into the grievances; and on the issue of traceability, I have told them that it (traceability) is their job.”

"But the Whatsapp platform is not to be abused by terrorists and extremist elements by repeating messages. There must be a mechanism whereby those could be traced. The CEO has assured me actions on these fronts,” Prasad said.

Cathcart said the minister talked about cooperating with law enforcement, and making changes in the products to deal with 'virality.’ 

The government wants WhatsApp to allow it to track its encrypted messaging platform for it wants to check the spread of misinformation that has led to several mob lynchings in the country over the last year. WhatsApp has been saying the messages are end-to-end encrypted.

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