WhatsApp Pay's India struggle: Can Kunal Shah turn it around?

India is WhatsApp's largest market, with hundreds of millions of users relying on the messaging platform every month. Yet when it comes to digital payments, WhatsApp Pay remains a marginal player in India's fiercely competitive UPI ecosystem.

That gap between messaging dominance and payment adoption has now become a major challenge for Meta. The company has appointed Kunal Shah, founder of CRED, as the new global head of WhatsApp as part of a broader push to strengthen its payments and commerce ambitions. Meta has also invested $900 million in CRED, valuing the fintech company at $4.5 billion.

Also read: WhatsApp’s privacy policy and the myth of user choice

The move signals Meta's determination to transform WhatsApp from a communication platform into a payments and commerce powerhouse.

Market reality

India has over 853 million monthly WhatsApp users and roughly 500 million active UPI users. Yet WhatsApp Pay has failed to convert its messaging dominance into payment transactions.

As of May 2026, WhatsApp Pay accounted for just 0.65 per cent of India's UPI market. In comparison, PhonePe held 46.2 per cent market share, Google Pay 32.7 per cent and Paytm 7.9 per cent. Even smaller players such as Navi, SuperMoney, BHIM, FamPay and CRED are ahead of WhatsApp Pay.

For an app used by millions of Indians every day, the ranking is striking.

Late arrival

One major reason for WhatsApp Pay's struggles was timing.

PhonePe entered the market in 2016, while Google Pay followed in 2017. WhatsApp Pay, however, did not receive full regulatory approval until 2020.

By the time WhatsApp entered the payments space, Indian consumers had already formed habits around rival UPI apps. PhonePe and Google Pay had established themselves as the default choices for everyday transactions.

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The delay meant WhatsApp was playing catch-up from the very beginning.

Regulatory hurdles

WhatsApp Pay also faced significant regulatory restrictions.

Indian regulators required WhatsApp to store payments data locally and keep it separate from Facebook operations. The National Payments Corporation of India (NPCI) also imposed limits on the number of users WhatsApp Pay could onboard, citing concerns about market concentration.

The cap remained in place for several years and was only fully lifted in December 2024. By then, competitors had already consolidated their positions and built strong user loyalty.

When WhatsApp finally received the freedom to compete without restrictions, the market had largely been decided.

Missing incentives

Another challenge was strategy.

PhonePe and Google Pay aggressively used cashback offers, scratch cards and rewards programmes to encourage users to adopt digital payments.

Also read: Kunal Shah to lead WhatsApp globally; CRED to raise Rs 8,550 cr from Meta

WhatsApp Pay did not match that approach.

While competitors spent years building user habits through incentives, WhatsApp largely relied on its existing user base. Industry observers argue that the platform failed to provide a compelling reason for users to switch from apps they were already comfortable using.

Product problem

WhatsApp Pay's design may also have limited its growth.

Unlike dedicated payment apps, the service remains embedded within WhatsApp's interface. Many users are either unaware of the feature or rarely encounter it during their everyday messaging activity.

There is no standalone payments experience, dedicated home-screen presence or strong prompt encouraging regular usage.

As a result, WhatsApp continues to be viewed primarily as a communication platform rather than a payments service.

Merchant gap

The company's focus on peer-to-peer transfers created another disadvantage.

Competitors expanded aggressively into retail commerce by deploying QR codes, soundbox devices and merchant payment infrastructure across India.

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These efforts helped PhonePe and Google Pay become deeply integrated into everyday purchases, from neighbourhood grocery stores to restaurants and retail outlets.

While competitors built physical payment ecosystems on the ground, WhatsApp Pay remained a feature within a messaging application.

Trust concerns

Privacy concerns have also played a role.

Some users have been hesitant to link bank accounts to a platform owned by Meta. Those concerns were reinforced by frequent spam and phishing messages circulating on WhatsApp.

The platform's reputation as a messaging service has not always translated into confidence as a financial services provider.

WhatsApp's own product evolution reflects this challenge. With WhatsApp Flows, users completing purchases within business chats are no longer required to use WhatsApp Pay. Instead, they can pay through any UPI app or credit card via secure payment options.

In effect, WhatsApp's commerce strategy already assumes that many users will choose competing payment platforms.

Test for Kunal Shah

Meta hopes Kunal Shah can change that.

The founder of CRED has been appointed as WhatsApp's new global leader while Meta takes a minority stake in his fintech company through a $900 million investment.

Also read: SC warns Meta, WhatsApp, says 'won’t allow exploitation of user data'

Shah previously founded FreeCharge before launching CRED, which grew into one of India's most prominent fintech platforms. Meta believes his experience in consumer payments and financial products can help unlock WhatsApp's next phase of growth.

According to Meta CEO Mark Zuckerberg, Shah brings the "builder mentality and global perspective" needed to lead WhatsApp into its next chapter.

The road ahead

Meta's investment structure also attempts to address privacy concerns. Both Meta and CRED have stated that Meta will not receive access to CRED customer data as part of the transaction.

What Shah inherits is a platform with unmatched reach but limited success in payments.

WhatsApp has already left a mark on India's vocabulary through phrases such as "WhatsApp University" and "WhatsApp uncle". Whether WhatsApp Pay can become equally embedded in India's digital payment culture remains uncertain.

With WhatsApp Pay holding just 0.65 per cent of the UPI market, Kunal Shah's biggest task may be convincing millions of Indians to do something they have so far resisted: pay through the same app they use to chat.