Facebook's Whatsapp Is Joining Hands with Indian Banks to Bring Credit, Pension, and Insurance to Its Users

In a significant stride towards financial inclusion in one of the biggest markets, India, Facebook’s WhatsApp plans to offer products including credit, insurance, and pension to lower-income people and those in rural areas in India, and help digitalize local SMBs (small and medium-sized businesses). The WhatsApp messaging service has been working with Indian banks such as ICICI, HDFC, and Kotak Mahindra, for more than one year to explore new ways to bring financial services to users who have yet to become part of the banking population.

On Wednesday, WhatsApp’s head in India, Abhijit Bose, made the announcement during the Global Fintech Fest conference through video conference. The company’s work over the last year has already proven that banks in India can leverage the reach of the instant messaging app. Bose stated that Kotak Mahindra and ICICI Bank have reached over three million new users. WhatsApp’s head in India announced that the Facebook-owned company now plans to work with more partners to offer credit, micro-pension, and insurance to lower-income individuals and the informal economy over the one-and-a-half year.

The company will pilot many projects with partners to test products to bring these services to users, Bose explained. He explained that the company will co-invest and scale based on the results, and even a minor conversion of the demand will result in an infusion of significant savings into the financial system.

The collective aim of the company over the next two years is to be able to help lower-income workers to easily access the three above-mentioned products. Bose stated that with a reach of more than 400 million users in the country, the WhatsApp messaging app is uniquely positioned to bring more individuals into the financial ecosystem.

Back in 2018, Facebook launched WhatsApp Pay to a small number of users in India, however, the project has been stuck in a regulatory maze since 2018, and the company could not roll out the feature to all users in the country. Facebook announced that the company has complied with all the requirements mandated by New Delhi’s central bank which indicates that the service could receive the final approval for a wide rollout of the feature any time soon.

Facebook-owned WhatsApp also plans to digitize businesses and help them secure working capital. In April, the social media giant invested $5.7 billion in Reliance Jio Platforms, India’s top telecom operator. Earlier this year, Ajit Mohan, Facebook India head, told TechCrunch that Facebook has always focused on helping small businesses.

On Wednesday, Bose stated that he is hopeful some of its financial services bets will work in the country and that the company will be able to replicate those models in other markets as well. UPI is of those Indian platforms that Facebook wishes to help bring to other markets.

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