WhatsApp Hikes International OTP Charges: Will Amazon, Google And Microsoft Pay More In India?

Meta-owned messaging platform WhatsApp has rolled out a new category for international one-time passwords (OTPs), marking a notable shift in its pricing strategy aimed at boosting revenue from enterprise services.

The revised pricing for these messages in India now stands at 20 times higher than it was charging earlier. Despite the sharp increase, the cost remains half of what enterprises pay for traditional SMSes, signalling WhatsApp’s intent to attract more businesses to this burgeoning segment, ET reported.

The report further said that effective from June 1, the new category, labelled ‘authentication-international’ messages is priced at INR 2.3 per message for the Indian and Indonesian markets, as indicated on WhatsApp’s website.

The move is likely to impact the communication budgets of international companies like Amazon, Google, and Microsoft which have been using WhatsApp as a cost-effective alternative to the high prices of international SMS in India.

While local businesses were charged INR 0.12 per SMS by telecom companies, overseas companies were made to pay the relatively higher price of $0.05 (around INR 4.13). This price gap led WhatsApp to introduce a uniform rate of INR 0.11 per OTP message for all businesses. But under this new setup, foreign companies will now be charged INR 2.3 per message, the report added.

The enterprise messaging market which includes SMS, WhatsApp Business, Google RCS, and push notifications is currently valued at over INR 7600 Cr. Moreover, as per Juniper Research, the OTT business messaging traffic in India is predicted to reach 24.2 Bn messages in 2028, rising from 4 Bn messages in 2023.

 However, conventional telecom SMS still dominates this market covering nearly 90% of the market share. In terms of usage, OTP verification for various purposes, such as application logins, financial transactions, and service delivery, accounts for roughly 80% of all enterprise messaging communication.

In 2023, Juniper Research also outlined that India’s telecom operators are expected to incur a loss of $29.2 million (around  INR 250 Cr) in business messaging (SMS) revenue to over-the-top (OTT) messaging platforms over the next five years.

In September last year, WhatsApp officially announced the launch of WhatsApp Channels in over 150 countries, including India.