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A logo of WhatsApp is pictured on a T-shirt worn by a WhatsApp-Reliance Jio representative during a drive by the two companies to educate users, on the outskirts of Kolkata, India, on October 9, 2018. — Reuters 
  • WhatsApp planning next phase of payments push in India.
  • Company wants to target users with cash rewards: sources.
  • WhatsApp testing incentives for merchant payments: sources.

WhatsApp will roll out cashback rewards to lure more Indians to its peer-to-peer payments service and is testing similar incentives for merchant payments, two sources said, as the company seeks to compete with rivals including Google.

The latest move comes days after WhatsApp won regulatory approval to more than double its payments offering to 100 million users in India, its biggest market with more than half a billion users overall. read more

The sources, who have direct knowledge of the company’s plans, said WhatsApp will, before the end of May, launch the cashback offer of up to 33 Indian rupees ($0.40) for transfers users make on its payments service, which allows contacts to send each other funds from within the messenger app.

The incentive, spread over three transactions, will be given irrespective of the amount being transferred, even if it is as little as 1 Indian rupee, in what one source described as WhatsApp’s “user acquisition drive.”

The WhatsApp cashback amount may appear small, but Neil Shah, vice president of research at Counterpoint Research, said it would be a “compelling enough” reason for users to switch.

“You won’t leave money on the table as an Indian,” Shah said.

In a statement responding to a question from Reuters, WhatsApp said it is “running a campaign offering cashback incentives in a phased manner to our users as a way to unlock the potential of payments on WhatsApp.”

Separately, in a broader payments push, WhatsApp is testing a programme where it will dole out cashback incentives for users who pay highway tolls, and utility and other bills straight from the app, the two sources said.

WhatsApp also wants to test such incentives for those making mobile payments for Reliance Jio, India’s biggest telecom operator, the sources said. Reliance is a partner of WhatsApp whose parent Meta in 2020 invested $5.7 billion in the Indian firm’s digital arm.

WhatsApp did not comment on these plans, while Reliance didn’t respond to a request for comment.

The cashback push comes after WhatsApp in June 2021 conducted an internal study to assess competition in India. Seen by Reuters, the “Winning from behind on India payments,” study says “incentives are among the top sign up reasons for our competitor apps” in India.

WhatsApp also assessed it needs to go beyond peer-to-peer payments as users use rival apps to make merchant and bill payments which, the study stated, will be a “more attractive proposition (for users) to switch over” to WhatsApp.

WhatsApp competes with Google Pay, Ant Group-backed Paytm, and Walmart’s PhonePe in India’s crowded digital payments market.

WhatsApp’s growth has been hamstrung as India has, for months, capped the number of users to which it can offer its payments service on fears that opening it to all its users could strain the country’s financial infrastructure.



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