Sources familiar with the matter told Reuters that the service is eyeing a similar move to that it has proposed in India – and for which it continues to await regulatory approval as data storage rules have impeded progress.
Whereas in India, WhatsApp is planning to set up a peer-to-peer payments service, in Indonesia it would instead serve as a platform through which users can access other digital wallet providers, the sources said.Partnering with local providers is one way in which WhatsApp can circumvent regulations in place in some countries – among them Indonesia – that complicate WhatsApp’s ability, as a foreign company, to create a digital wallet.
Among the potential partners, the sources said, are the ride-hailing app Go-Jek, which also boasts payments capabilities, direct payments and fintech firms DANA and OVO, as well as the larger Lippo Group, a local conglomerate. As many as three deals are expected to close shortly.
A Facebook spokesperson confirmed that there have been conversations in the country. “WhatsApp is in conversations with financial partners in Indonesia about payments, however the discussions are in early stages and we do not have anything further to share at this stage.”
Payments are an important avenue for Facebook’s apps, which CEO Mark Zuckerberg has talked about elsewhere. “As Mark has said earlier this year... we are looking to bring digital payments to more countries,” the spokesperson continued.
In Indonesia, as in other parts of mobile-first South-East Asia, the payments market is heating up, as multiple players begin to jostle in the market that has the potential to open up an e-commerce ecosystem worth hundreds of millions of dollars.
However, despite the fertile market, regulations in Indonesia are some of the regions toughest. If WhatsApp is able to unlock the market in such circumstances, the chances of the model moving to other territories will only improve.
Sourced from Reuters, WARC