RBI Withholds WhatsApp Pay in India Citing Non-Compliance of Data Laws

Nov. 8, 2019

Followingdire predictions from ‘experts’and persistentskepticism from politicians, the Reserve Bank of India (RBI) has told the Supreme Court that WhatsApp doesn’t have its permission to start itsproposed payments servicein the country. According to the RBI, the Facebook-owned platform is still non-compliant with India’s data localization laws, which is why it has directed the National Payments Corporation of India (NPCI) to prevent the company from launching its UPI payments service.

The development comes in the wake of a recent admission from the company that an Israeli cyber-surveillance company called theNSO Group had exploited a WhatsApp vulnerabilityto carry out a series of cyber-attacks against around 1,400 journalists, human rights activists, political dissidents and diplomats from 20 countries. According to WhatsApp, the Israeli firm used a state-of-the-art spyware, called Pegasus, to carry out the attack that also reportedlyaffected many activists in India.

It’s not immediately clear how WhatsApp will respond to the latest development, which deals a massive blow to its aspirations of launching a UPI-based payments service in the country that could compete with the likes of Paytm, PhonePe and Google Pay.

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