Google has sought the Reserve Bank of India (RBI)’s approval to integrate the government-promoted Unified Payments Interface (UPI) with its Android Pay application, marking its entry into India’s fast-growing digital payments space.
“Google’s testing is almost complete and the NPCI is waiting for RBI approval,” said A P Hota, managing director a of the National Payments Corporation of India (NPCI). “Let me not give any timeline because the RBI would like to take their own time for things like this.”
In India, nine of 10 smartphones sold run on Google’s Android operating system, giving the company access to hundreds of millions of customers. India has 330 million smartphone users, with more than 100 million new ones sold every year.
Apart from Google, social networking giants Facebook and WhatsApp are also in discussion with NPCI to integrate UPI within their chat messengers. “As far as WhatsApp is concerned, discussions have commenced, it requires a series of discussions… For Facebook, discussions are in preliminary stage,” Hota said, according to PTI.
A Google India spokesperson said in an e-mail response: “We are always looking for ways to make it easy for people to pay with their mobile devices, such as Android Pay in some countries, and looking to expand those capabilities to the next billion users.”
While e-commerce giant Flipkart already accepts UPI payments through its subsidiary PhonePe, rival Amazon will shortly roll out that functionality. In the cab-hailing space, Uber is currently working to roll out UPI-based payments, while rival Ola has already done so. On the social networking front, Hike Messenger is looking at a similar integration.
An Uber spokesperson told Business Standard: “We are currently evaluating the possibilities around a comprehensive UPI integration and continuing to engage with relevant stakeholders. As a first step, we will look at offering our riders the option to use their existing UPI IDs to pay for their Uber rides.”
Google, Facebook and WhatsApp will bring unprecedented scale for digital payments. Facebook is estimated to have 140 million users in India, while WhatsApp’s user base in the country crossed 200 million February year.
“These are big international players. Whether there are risks other than technological ones have to be seen by the RBI,” added Hota. “WhatsApp, Google and Facebook have a very pervasive presence in India, and now if they come into payments, banks should not get threatened.”
India’s largest digital payments player, Paytm, claims it has 218 million users on its platform but does not allow customers to transact using UPI. The company says it should integrate with UPI sometime in August, now that it has a payments bank licence.
Like PhonePe’s integration with UPI, all three tech giants will have to partner with banks to enable customers to pay through India’s digital payments network. NPCI says integration of UPI with their services is absolutely feasible but the providers should comply with RBI norms.