a major setback to Facebook, WhatsApp’s digital payment services have been suspended in Brazil a week after it was officially rolled out in the country. The feature allowed users to send money through the messaging app but now Brazil’s central bank has ordered Mastercard and Visa to halt the payment services.
Brazil’s central bank said in a statement that it took the decision to “preserve an adequate competitive environment, ensuring an interoperable, fast, secure, transparent, open and economical payment system.” The bank had also raised privacy concerns regarding WhatsApp’s digital payment services. They also suggested that the bank didn’t get the opportunity to analyze WhatsApp's services before it was officially rolled out.
However, WhatsApp said that it will continue to work with the local partners and central bank to make it possible. “Our goal is to provide digital payments to all WhatsApp users in Brazil using an open model and we will continue to work with local partners and the Central Bank to make this possible. In addition, we support the Central Bank’s PIX project on digital payments and together with our partners are committed to work with the Central Bank to integrate our systems when PIX becomes available,” a WhatsApp spokesperson told TechCrunch.
Earlier, announcing the feature in Brazil, CEO and co-founder Mark Zuckerberg had said, “We’re excited to announce that starting today we’re bringing digital payments to WhatsApp users in Brazil. People will be able to send money securely or make a purchase from a local business without leaving their chat,” the company said in a blog. He also stated in his blog that it is building Facebook Pay which would provide a secure and consistent platform to people to make payments across all the Facebook-owned apps. Brazil was the first market where WhatsApp could officially roll out its digital payments services.Interestingly, WhatsApp has been testing the digital payments feature in India for over two years. The Facebook-owned company has been struggling to roll out the feature officially in India due to pending approvals from the authorities. Earlier, it was being speculated that The National Payments Corporation of India (NPCI) has reportedly granted its permission to WhatsApp to formally start its payments services in India albeit in a phased manner. The Facebook-owned messaging app had apparently collaborated with ICICI Bank, Axis Bank, and HDFC Bank to make the feature available in India. Some reports even suggested that the feature will be launched in India in May but that didn’t happen.
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