WhatsApp digital payment platform set to fail

WhatsApp is about to support digital payments in India.
WhatsApp is a messaging platform used throghout the world. In India (it seems) the government has arm-twisted WhatsApp to support digital payments. Indian government thinks that by this action, digital payments will increase in India.

People pay by cash in India because

• Taxes are high
• Government regulations are high.

Whether WhatsApp supports digital payments or not, these facts are not going to change. So WhatsApp digital payments platform will have limited success like Paytm, FreeCharge, etc.

Here is an example. India levies an import duty of about 10% on gold. In local Indian market, gold is sold at about 5% more than international price. This means that almost all gold being sold is smuggled. The seller wants cash for gold. The buyer also prefers to pay cash because if a digital payment is made, then

• taxes will have to be paid.
• PAN number will have to be revealed leading to potential harassment from income tax officials.

If India wants to go cashless or less-cass, then

• Reduce taxes
• Reduce regulations

More and more people will then adopt digital payment for convenience.