Mumbai | Bengaluru: A temporary takedown of Paytm, one of India’s best-known financial services applications, from Google’s Android Play Store on Friday on the ground that it was facilitating unregulated gambling, engendered a major controversy with the app’s founder Vijay Shekhar Sharma terming the move as being “against Prime Minister Narendra Modi’s vision of Atmanirbhar Bharat.”
The app was back on the Play Store by evening after Paytm agreed to remove a new UPI cashback feature called ‘Paytm Cricket League’ that was rolled out on Friday morning, a day before the start of the 13th edition of the Indian Premier League (IPL). Google decided to ban the Paytm app due to the Indian company’s violation of its policy against “simulated gambling content”, the tech major said.
“Paytm App is back…We launched a UPI CashBack campaign this morning. Our app got suspended by Google for this. India, you decide if giving cashback is gambling,” Sharma tweeted on Friday evening.
Some industry experts criticised the takedown pointing to a potential conflict of interest as Google Pay competes with Paytm.
In a blog post released earlier on Friday, Suzanne Frey, Vice President, Product, Android Security and Privacy, Google, wrote that “we don’t allow online casinos or support any unregulated gambling apps that facilitate sports betting. This includes if an app leads the consumers to an external website that allows them to participate in paid tournaments to win real money or cash prizes, it is a violation of our policies.”
A representative for Google told ET that Frey’s blog post is the company’s policy clarification ahead of the IPL and that it states Google’s stance against online gambling. Paytm was among other apps against which the tech giant has acted, the spokesperson said. ET was unable to verify which other apps had been taken down along with Paytm from the Play Store.
“We are surprised that our app (was) taken off (Play Store). Google has unilaterally taken the decision to remove the app without listening to us,” Vijay Shekar Sharma told ET.
Other Indian entrepreneurs ET spoke to voiced the need for a domestic App Store to take on the power wielded by the Big Tech firms such as Google and Apple.
Some industry experts were vocal in their opposition to Google’s move, which they said had taken them “by surprise”. Vishwas Patel, chairman of Payments Council of India, said, “Paytm has been at the forefront of enabling payment services for bottom-of-the-pyramid customers. We understand that the move was taken due to violation of Google’s gambling policy.”
People aware of developments told ET that “arbitrary flagging” of Indian internet applications by Google could be one of the issues to be raised by the industry when the guidelines for the proposed Self-Regulatory Organisation (SRO) for payments is finalised by the central bank. “Google Pay is in competition with Paytm, so (its action) may be construed to protect GPay interests in the payment industry or maybe get an edge,” said cyber and privacy lawyer Prashant Mali.
People in the know told ET that Google’s action was based on a violation of its Play Store norms by Paytm’s new feature which allowed the app’s users to avail cashback offers through scratch-cards, allotted on a random basis, linked to the real-time performance of IPL players.
Industry executives claimed the action, coming a day before the start of the Indian Premier League’s 2020 season, had also created “panic” among customers who used the Paytm app to avail banking services. Paytm has an RBI-approved Payments Bank license.
Earlier, in a swift response to Google’s action, the Noida-based fintech company said it had rolled back the contentious cashback feature on a temporary basis while assuring customers, in a blog post, that their digital balances were safe. Explaining its stand, Paytm confirmed it had “received communication from Google that they are suspending our app because they believe this to be a violation of their Play Store policies on gambling.”
“While it is clear that all activities on Paytm are completely lawful, we have temporarily removed the cashback component in an effort to meet the Play Store policy requirements. We continue to work with Google to restore the app. We assure all our users that their balances and linked accounts are 100% safe,” the post stated.
‘NOT IN VIOLATION OF INDIAN LAW’
A Paytm spokesperson told ET earlier on Friday that the newly rolled out feature was not in violation of any Indian law, while pointing out that Google too had such cashback features on its popular UPI app Google Pay. “We have stickers and cashbacks, Google also has them by the way, where you have a scratch card and you can win cash,” the Paytm spokesperson said. “Does it violate the law of India? No, it does not. And it is very similar to what Google Pay does,” said the person cited above, adding that it was an issue not limited to Paytm alone and pointed to how Google “regulated” India’s internet landscape.
Experts said Google’s action stems from the company’s view that IPL-linked cashback feature offered by Paytm violated its stance on non-skill-based fantasy gaming, which is prohibited under Google’s anti-gambling policy.
Mukesh Kumar, engagement manager at consulting firm Redseer said that unlike Apple’s app store, the Google Play Store doesn’t allow any real money-based gaming application. “Therefore, you can find real money gaming Dream 11, RummyCircle, Adda52 on Apple’s app store but not on Google Play store,” he said. In India, gaming is a subject regulated at the state level. While some states allow games such as rummy and poker and count it as a game of skill, others including Telangana, Odisha, Assam, Sikkim and Andhra Pradesh have bans on these games.
Siddharth Mahajan, Partner at Athena Legal, says that Indian law draws a distinction between games of chance and games of skill. “Games of skill are allowed while games of chance are considered gambling. Many states have specific laws that specifically outlaw gambling and betting while allowing or imposing some restrictions on games of skill as well,” he said.