WhatsApp eyes lending feature in India as Amazon rolls out Pay Later
techcrunch.com
techcrunch.com
When all it takes is a single forward from your WhatsApp uncle/aunty to undo all the rationale induced in the vulnerable members of the family to protect them against COVID-19, it should be treated the same way as a security vulnerability on a platform is treated; only in this case the vulnerability is limited attention/cognitive biases of the users, nevertheless it's the platform which enables it to be exploited.
I appreciate the steps taken by WhatsApp to limit fake news & misinformation such as limiting forwards; but it is certainly not enough. They need to implement aggressive detection, reporting and banning mechanisms for those who spread even a single misinformation/fake news.
I don't think it's the Engineering effort which stops them from doing that.
Two issues with this:
1. This is simply not a realistic standard in India, a nation which lacks the basic level of education of many Western nations. While this is true of a few people in most nations, and while many citizens can't be bothered to check, it helps if some at least have the background knowledge to do their own fact-checking rather than just taking the word of one person over another.
2. The "who decides" problem, best illustrated by yesterday's removal of the medical opinion of two front-line doctors from you tube because it "contradicted WHO recommendations". One man's "fake news" is another man's "front-line reporting".
2016 US elections showed western education doesn't help much in defending against misinformation campaign.
I'm not denying that filtering fake news is going to hard, but when people are getting killed directly as a result of fake news from a platform[1], democratic process are undermined by misinformation campaigns, everything which needs to be done should be done.
As for YouTube moderation policies, at least there are some policies which we can debate upon.
[1]https://en.m.wikipedia.org/wiki/Indian_WhatsApp_lynchings
How exactly did they show this?
As someone who is not american, these youtube shows are our news about US. Whether these shows are misinformed? Honestly I don't know.
The mere existence of such a campaign does not suggest that it actually impacted election results.
The guys sent SMS to everyone in your contact list if you didn't pay. LOL
I use this link which will open in WhatsApp by default to send a WhatsApp message to someone who is not in my Contacts and don't want to add to my Contacts just to send a WhatsApp message.
It will be a pain in the arse to use for all your contacts and probably not worth the effort as if you use WhatsApp regularly (for an Indian there's no way around it) you will have sent a message to almost everyone on your contact list at least once and Facebook will know about it rendering the whole thing pointless.
So then you can at least minimize the number of contacts you expose to WhatsApp to the number of people you're actually in touch with regularly over WhatsApp.
People forget how many of that 400 million are illiterate and waiting to be taken for a ride.
"We can reach everyone therefore we should" mindless characters crawling like termites all over the place.
The investment was a strategic one too, Facebook could leverage this relationship with Jio (reliance) to keep mining data.
Edit: here's a fantastic thread on the relationship between FB and Jio.
Ah, unintended side effects that leave citizens worse off at work once again...
Loans could be fine if done properly but the idea of tons of financial tech companies being forced to push loans hard in order to offer their original and far more stable business model swept from beneath their feet is worrying.
Nor is it guaranteed the loans will be feasible enough business to cover expenses for the primary financial networks... Let alone covering any sort of customer service, help fighting fraud and theft, or to invest in expansion to new markets, or improving their software products, cover their own banking fees and insurance risks, pay their workers a decent salary, etc, etc.
The government basically limited access to a potentially massive marketplace that would do wonders for the wider economy, increasing efficacy and benefiting local business (India's economy is terribly inefficient and littered with rules that change every region), and instead of charging for the actual service they are providing they will be forced to push a bunch of debt onto the communities that they don't need (or some other shady monetization strategy like selling data and advertisements or other stuff that may even hurt the original business).
This will also likely further limit the market to a monopoly as it requires massive scale to get the <1% who might have loans, so they can get good enough deals with the banks to lower their own fees to have survivable margins. On top of the main business expenses.
Monopolies are famous for being extremely anti-consumer but still surviving with little competition because they are the only ones big enough to navigate the countless legal, regulatory, and technical hoops required.
Destroying the most basic business model... Even before the companies get off the ground (article says the gov still only granted access to a million customers) sounds like a terrible idea.
Who knows how much the fees could have declined from competition alone? Or whether anyone will even continue investing in it if no model exists.
Just saying the government can write even more rules around the debt will make all problems go away is very naive. Unless your end game is gambling all the pieces will come together before it all crashes or the government running it themselves and/or let taxpayers cover the losses?
>and instead of charging for the actual service they are providing they will be forced to push a bunch of debt onto the communities that they don't need
This is an absolutely ridiculous argument. Your argument boils down to "Government shouldn't stop bigco from doing anything bad, as then they will be forced to do even more shadier stuff".
>Destroying the most basic business model... Even before the companies get off the ground (article says the gov still only granted access to a million customers) sounds like a terrible idea.
This argument is wrong. First of all, WhatsApp was not granted access to all customers because they said they weren't ready to interoperate with others, i.e, whatsapp users couldn't pay google pay users. A fundamental requirement of UPI is interoperability, so regardless of which app you use, you can pay anyone on any app. This can be avoided if you are in testing stage, like WhatsApp was, but then your acesss is not to all customers.
> Who knows how much the fees could have declined from competition alone? Or whether anyone will even continue investing in it if no model exists.
The fees are zero via any bank app. I don't see how a bigco can ever offer lower fees than the providing bank.
With everything happening right now, it's incredibly irresponsible for such a product to be released in a market that is unprepared to deal with the consequences.
Starvation for many families who would avail of this service is a fact. Many have come out and said that they will probably starve long before they contract any virus. Scary stuff. Shame on Amazon and shame on Facebook!
1. You're ignoring middle class and well-off people in those countries. 2. Access to credit is important for developing economies. 3. Access to credit doesn't imply predatory lending, that's a separate problem in how the creditor runs their business.
I know that this service will be abused by those who need quick access to capital and it will ruin many of their lives. I don't support payday lending either, doesn't mean that it's illegal but it sure is unethical to charge high interest rates on low sums.
The people that are facing starvation are not Amazon customers in the first place; they are mostly migrant labour that doesn't have a fixed address, or they live in remote areas where Amazon does not deliver.
Also, we don't know what the interest rates are, as yet.
Facebook + Jio = Skynet.
I'm a noob at economics so please ELI5.
But since a capitalist came up with this, it would not surprise me if the loan terms are horrendous and basically means they will be loansharks with slaves trying to pay off the loan in the future.
[1] https://www.theguardian.com/world/2020/apr/04/i-just-want-to...
If day wagers stay out of work how can they possibly earn the money or interest required to pay the short term loan? Most day wagers have already exhausted their savings. Debt on top of debt usually means starvation in these countries.
There are (were?) already microcredit websites where people in the developing world place loan requests like "I need a $500 loan to start a little shop", and a bit like Kickstarter, you can give them the loan, but also you accept this shop idea might not work and they would default on their loans -- and the site tells you this, so from your point of view the loan would become charity.
I hope they won't and the gov will side with them.
Not sure whether this should be amended?
Do they fly in people with guns from California ?
The problem was never access to credit, but access to high income jobs.
Not too different than what happens anywhere in the world.
I disagree that it is a jobs issue. It is a legal issue and what procedures exist for these situations.
It's like investing in a business except with almost all of the downside if they do poorly and very limited upside if they do well. It's a deceptive economic tool for social control, that's all it is.
The economy would be way better off if we just illegalized lending. Especially lending by banks.
But if they ban lending, it would cut demand to buy properties and would cause a price crash. Then within 5 years, I would be able to buy a house with cash.