Facebook Finally Launches WhatsApp Pay After Nearly a Year in the Works

WhаtѕAрр hаѕ finally launched itѕ digitаl payment ѕеrviсе оn itѕ mеѕѕаging app. Thе payment service, саllеd WhаtѕAрр Pay, which hаѕ bееn in thе works fоr ѕоmе timе iѕ nоw available fоr WhаtѕAрр uѕеrѕ starting with Brazil.

According to the blog post, WhatsApp users will now be able to send and receive money securely or make a purchase from a local business directly on the app using Facebook Pay. Facebook Pay is the digital payments service launched by Facebook last year.

The new WhatsApp Pay has already been rolled out in Brazil and will be expanding to other countries going forward.

“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,”

Extract from blog statement
How WhatsApp Pay works
WhatsApp users can use the payment service by linking up their WhatsApp account to either Visa or Mastercard credit or debit cards. In Brazil, WhatsApp has collaborated with local partners including Banco do Brasil, Nubank, Sicredi and Cielo, a payments processor to complete transactions.

After linking up a card, payment can then be made directly through the Facebook pay interface to the seller. According to Instant Messenger, using the payment service is currently free for individuals but businesses will pay a processing fee to receive payments. Its also added that for security purposes, the payment service will work with a six-digit PIN or fingerprint.

Facebook finally commercialises Whatsapp
Since acquiring WhatsApp in 2014, Facebook has made several efforts to generate significant revenue from the messaging platform. From the WhatsApp idea which was recently scraped to the creation of WhatsApp business, various models have been tried and tested by company.

With a current user base of over 2 billion, the launch of Whatsapp Pay is another shot by the company to build a huge revenue stream from the apps based on its huge amount of users. The payment service which has been in testing since 2018 is finally moving towards a global launch.

Possible Influence of Whatsapp Pay in Nigeria
In Nigeria, Whatsapp is the most popular messaging app. It is used by about 85% of the total internet population in the country. That translates to about 104.7 million according to NCC stats.

With over 100 million usera, launching a payment service in Nigeria will significantly affect other players in the sector like Paystack, Flutterwave and Voguepay.

The fact that WhatsApp is giving people not just a place to view, chat or send payment details but also to complete transactiona will entice a large number of its users. This is in part because users don’t have to sign-up or sign-in afresh into other, sometimes suspicious payment platforms to send payments and complete a transaction.

However, it could be a new source of income for the federal government with the new Nigerian international tax that says foreign tech companies must pay tax if they generate over N25 million in revenue from Nigerians.

There is, however, the chance that Whatsapp may end up not having to pay any tax if agreement is not reached on the new OECD’s International Tax Rule.

Recommended Read: The International Tax Rule and Nigeria’s Bid to Tax Amazon, Facebook and Other Foreign Digital Coys

Summary
In its blog post, WhatsApp didn’t clarify if it will be open to working with other kinds of payment methods, or other payment gateways beyond Facebook Pay. However, with WhatsApp Pay trial in India using UPI, it’s very likely that it won’t be Facebook Pay for all its markets.

What this means is that payment gateways like Interswitch and Paystack could have the opportunity of partnering with WhatsApp to bring its digital payment service into Nigeria.

However, Nigeria may not get WhatsApp pay any time soon, given its current link with Facebook Pay, which is not available in the country. This is because Facebook will likely prioritize rolling out the digital payment service in the markets the Facebook payment service is available.

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