Is Convenience Platform By Tech Companies Causing Inconvenience To POS Manufacturer?

Several Founders, Co-Founders, CXO Bankers, CXO Fintech professional & people who participated in the ePanel discussions:

Mr. Raghu Veer Dendukuri, Founder, Ideal Nation and Solution Architect at Invincible Tech Systems Inc.
Mr. Probir Roy, Co-founder, Paymate
Mr. Sandeep Todi, Co-Founder & CBO, Remitr
Mr. Arun Tanksali, Co-founder & CTO, Nearex
Mr. Kamonasish Aayush Mazumdar, Founder & CEO at Foodieverse
Mr. Taron Mohan, CEO & Promoter, NextGen Telesolutions Pvt Ltd
Mr. Hemal Shah, former Technical Product Manager, Mastercard
Mr. Muthu Krishnan, Associate VP – Merchant Acquisition, India Transact Services Ltd
Mr. Vikas R Panditrao, Co-Founder, Forum of Industry and Academic Knowledge Sharing (FIAKS)
Many other CEO/CXO Bankers & Fintech professionals on FIAKS Forum requested to remain anonymous

One of the community members mentioned we had discussions sometime back on companies like Google or WhatsApp blacklisting your country or individual. ^[1]Now, looks like they have done it in a different form. WhatsApp is saying take-it-or-leave-it choice is yours. Either your data goes to Facebook, or you’re out! Well, WhatsApp services are free and they are absolutely right to monetize its platform as businesses are not done for charity, isn’t it? So, here are some questions to be noted;

Question 1: Are we doing the mistake of allowing Google, WhatsApp, Truecaller, Instagram, etc kinds of companies in the banking & payment space.

This seems a rather dangerous mentality. “Allow” implies some kind of license, and we know how that works. In any case, different flavors of licenses already exist with different constraints and permissions.
There is a class – the App provider – which fortunately does not require anything. The system is designed to protect consumers from a disaster. Neither Google nor Whatsapp nor PhonePe holds end-user funds. If they all disappear tomorrow, there won’t be any problem greater than that of inconvenience. We will be back to the age of scant 5 years ago when the convenience of the kind today can only be dreamt of.
Market concentration is key. Not whether foreign firms should have unfettered power in the market. Has anyone done a CR4 + Herfindahl-Hirschman Index (HHI)calculation to measure if there is an unnatural concentration of market power in a few firms? With that one can make a case for ensuring fair and competitive market space in payments to both domestic and overseas players.
Big tech entering payments – protectionism in any form will only stifle innovation. The question needs to be reframed to not single out big tech but to ask how can every payment provider have a level playing field and participate in the public goods that are being built. Ultimately, these platforms are only adding a convenience layer to the existing system and not replacing it.
Yes, if the regulator started allowing them to function as a wallet for P2P payments then it’s a different ballgame. But these platforms are payment processing tech and not wallets. Nothing stops WhatsApp from launching a WhatsApp Card in the future and linking it with WhatsApp Pay. That then is a different product and will have its own set of regulations.
As far as they just act as a facilitator and are a pass-through without storing any PII and PCI data, it should be fine since they will be acting as just another interface provider, though the ‘reach’ is surely an issue that can limit the competition.
On the competition side, the approach should be to invite even more people – bring on competition and let the consumer choose.

Question 2: Facebook did not mention Jio Payments Bank and instead listed ICICI Bank, HDFC Bank, Axis Bank, and the State Bank of India as the four banks powering payments through the app. Why?