Today, Paytm and Mobikwik are established players in the e-wallets game as they offer a lot more services than simply sending and receiving money. This means that they are not likely to be as affected by WhatsApp Payments as the more recent entrants like Google Tez, which was launched in India just a few months ago in September. Tez being a fairly new payments app in India will see some challenge from WhatsApp in more ways than one.
Both WhatsApp Payments and Google Tez are UPI-based and both the companies have partnered with several Indian banks such as Axis Bank, HDFC Bank, ICICI and State Bank of India among others that support UPI. For the uninitiated, UPI (Unified Payments Interface) is a real-time payments system that enables digital transactions between banks without the need to input NFSC code and other bank account details. All users need to do is make sure is that their mobile number is linked to their bank account(s).
-- The biggest reason WhatsApp already wins this competition before it even gets going is thanks to the numbers. WhatsApp being the most popular messaging platform today enjoys over 200 million monthly active users, while Tez is slowly growing with 12 million users as of December 2017. While WhatsApp Payments is still rolling out and is yet to be made available for iOS users, we're still seeing a substantial number of users for the service compared to Tez. -- Pretty much everyone with a smartphone in India is on WhatsApp as it is the defacto messaging service.
This makes it terrifically simple to transfer or receive money between friends and family as they can perform the action from within the messaging service without the need to download another app. Tez, on the other hand, requires both the sender and receiver to download the app to enable payment using Cash Mode or via mobile number. A Tez user can also send money to a non-Tez user but that will require the other person's bank account details which makes it a slightly tedious process.
Google Tez is also limited in that it does not come with messenger feature. WhatsApp being a messenger service first, makes it easier for users to communicate with each other and transfer money on-the-go. Essentially, WhatsApp is a more holistic service as it allows for messaging and digital payments. -- WhatsApp's overall popularity gives it a boost over new players like Google Tez that is still new and still working to establish a user base.
As far as convenience is concerned, people are likely to prefer WhatsApp to send and receive money rather than download a separate app to do so. -- That being said, WhatsApp Payments also comes with its own limitations. As of now, the service only allows peer-to-peer transactions and nothing more. Meanwhile, services like Google Tez, Paytm and Mobikwik allow users to pay bills and enable transactions with merchants and businesses as well.
For users who rely more on digital transactions for various purposes, WhatsApp Payments will not be enough. -- The other big question mark is with regards to fraudulent transactions on WhatsApp. The messaging service has been a haven for spam letters and the payments feature could now enable fraudulent transactions by duping uninformed users. Google Tez, on the other hand, is less likely to cause such cases as it doesn't come with a messenger.
On the face of it, WhatsApp's peer-to-peer payments service already has the numbers and convenience factor going for it which gives it a leg up over services like Google Tez. However, without features like bill payment, WhatsApp Payments is limited. If one goes deeper one can see that WhatsApp Payments just adds to a plethora of digital payments services currently existing in India which may just add to the saturation of it all. It will be interesting to see how Tez grows amidst existing competition like Paytm and new challengers like WhatsApp Payments.
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