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WhatsApp accelerates Indian banks’ online push as distancing rules handicap branches

Due to WhatsApp’s chat-based interface, banks are seeing millions of people use WhatsApp banking.

While Facebook’s WhatsApp is working on getting its digital payment service up and running for the masses in India, the global messaging app seized an opportune time to join hands with a chain of local banks to extend their digital banking services. This partnership becomes imperative at a time when the COVID-19 outbreak is keeping a lid on how physical banks could serve their customers in the world’s second-most populous country.

Ever since the 70-day long lockdown was lifted in different phases, bank branches have been flooded with customers who were waiting for them to reopen for business. However, due to social distancing norms that are still in practice, most of the banks are limiting the number of maximum people who could be inside the branch at a time, resulting in long queues outside their gates.

Shambhu Nath, 43, is one such person who has been standing in the queue for about a couple of hours outside HDFC Bank at their Indiranagar branch in Bengaluru. With a bank form in his hand which he had to fill up while standing, Nath told KrASIA he was here to submit the documents regarding his loan application.

Facebook-owned WhatsApp is integrating its API (Application Programming Interface) with Indian banking lenders such as HDFC Bank, Kotak Mahindra Bank, Axis Bank, ICICI Bank, among a few others to enable basic digital banking services. Customers can send messages to their respective bank’s designated phone number on WhatsApp to seek information such as their bank balance, credit card statement, requisites for new account opening, and other such information.

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Even though these services are limited and wouldn’t help people like Nath, banks say there are millions of people who visit their branches for pretty basic needs which can be done using their apps. Due to WhatsApp’s chat-based interface which people are comfortable using, banks feel this would help them reduce footprints inside their branches.

A report by local media Economic Times (ET), said that banks have seen an increase in usage for WhatsApp banking. While ICICI Bank has seen close to a million users apply for ‘WhatsApp Banking’ services, Kotak Mahindra Bank told ET that it was handling 1.5 million monthly messages on the platform.

“Enthused by encouraging response, we have added several new features like instant savings account opening facility, access to pdf for our partnered newspapers, locating nearby essential stores and opting for loan moratorium to this service,” Bijith Bhaskar, head-digital channels and partnership at ICICI Bank, told ET.

It is to be noted that Indian authorities, including National Payment Council of India and Reserve Bank of India, are yet to give their go-ahead to WhatsApp Pay to open its digital payment service for its over 400 million users in India—its biggest market globally. Currently, it only has approval to beta test its payment feature on limited users. As of now, only one million WhatsApp users are able to transfer and receive money using the messaging platform.

As WhatsApp Pay waits for the authorities to give it a green light, its parent company Facebook has already entered into an agreement with Indian conglomerate Reliance to integrate its e-commerce venture JioMart with WhatsApp Pay for digital payments.