Facebook CEO Mark Zuckerberg said he is excited that its messaging service WhatsApp received approval to start a payments service in India.

The National Payments Corporation of India allowed WhatsApp on Thursday to go live on the Unified Payments Interface (UPI) in a graded manner, starting with a maximum of 20 million users.

"India is the first country to do anything like this," Zuckerberg said in a video message following the NPCI go-ahead, referring to the creation of UPI. "I'm glad we were able to support this effort and work together to help achieve a more digital India. It is opening up a world of opportunities for micro and small businesses that are the backbone of the Indian economy."

WhatsApp's payments service has been in beta mode for over two years and the approval came after months of regulatory hurdles and legal battles.

Zuckerberg said users can now send money to friends and family through WhatsApp as easily as sending a message. He said there is no fee and it's supported by more than 140 banks.

'Transactions are Secure and Private'

"All you need is a debit card with a bank that supports UPI and you can set it up straightaway. You can find it in the latest version of WhatsApp. And because it's WhatsApp, it's secure and private too," he added.

Stressing on digital payments being important and safer than handing someone cash, Zuckerberg said WhatsApp has been working on payments with the NPCI, which oversees "everything to make sure it's secure and reliable."

Starting Friday, people across India will be able to send money through WhatsApp, the messaging service said in a blog post. The payments service is designed with a strong set of security and privacy principles, including entering a personal UPI PIN for each payment.

According to Mandar Agashe, MD of Sarvatra Technologies, the first company to work with WhatsApp and ICICI Bank on payments in the pilot stage, a graded rollout to 20 million users for WhatsApp payments was a "fairly good enough size" to launch the service.

"WhatsApp has over 400 million users but how many of them have debit cards and how many want to do digital transactions? It shouldn't take too long for the numbers to go up. We are preparing for a surge," he told ET. "WhatsApp is already on the mobile phones of most users. So, activation of a service inside your current app is easier than downloading a new app and figuring out the services. It's very easy to use."

Approval for WhatsApp's payments service came on the day the NPCI restricted transactions of third-party apps to 30% of the overall volume of transactions processed through UPI during the preceding three months. In October, the UPI network processed 2.07 billion transactions.

For WhatsApp, the cap will apply from January next year. Existing third-party app providers such as PhonePe and Google Pay have until January 2023 to comply with the limits. "PhonePe and Google Pay will push harder now. The competition will clearly intensify," said a person familiar with WhatsApp's payments service plans.