MUMBAI: PayTM, the start-up backed by Chinese e-commerce giant Alibaba, currently dominates the digital payments market in India, but it could face a serious challenge from WhatsApp, the Facebook-owned messaging service.

Although WhatsApp has not confirmed reports that it is planning to launch into the booming Indian market, the company does have 200m monthly active users in the country and its website is currently advertising for a US-based "Digital Transactions Lead, India".

According to the post, WhatsApp wants to attract candidates with the technical expertise to "collaborate with banks" with an understanding of Indian financial standards, such as the Bharat Interface for Money (BHIM) and the Unified Payments Interface (UPI).

The Economic Times spoke with "a person familiar with the development", who explained that WhatsApp is exploring all modes of payments in India and that UPI is being considered as one of the alternatives.

According to the source, WhatsApp aims to get the correct technical expertise in place and this may, or may not, finally get adopted.

However, the Economic Times pointed out that it would be better for WhatsApp to integrate UPI instead of developing its own digital wallet because of the stricter guidelines that the Reserve Bank of India has set out recently.

"India is an important country for WhatsApp, and we're understanding how we can contribute more to the vision of Digital India," said a WhatsApp spokesperson, who did not comment on the company's exact plans.

"We're exploring how we might work with companies that share this vision and continuing to listen closely to feedback from our users," the spokesperson added.

That said, some analysts thought now would be a very good time for WhatsApp to introduce a digital payments service and that this could pose a threat to PayTM's dominance.

"India has been on a huge digital payments boom – WhatsApp couldn't have asked for a better time to roll this out," said Neha Dharia, an analyst at Ovum, in comments to the Financial Times. He added that WhatsApp's large base of users gave it an opportunity to "eat away" at PayTM.

Data sourced from Mashable, WhatsApp, Economic Times, Financial Times; additional content by WARC staff