WhatsApp's proposed username feature has raised concerns among experts and users, who believe the new offering could trigger a surge in impersonation, spoofing, and financial fraud.

Analysts caution that moving to platform-managed identities removes a crucial layer of accountability. Some users, like MobiKwik CEO Bipin Preet Singh, found that close variations of their names were already taken up during the early username reservation phase.

The concerns come in the wake of WhatsApp’s announcement of the introduction of usernames on the messaging platform, a feature that will allow people to communicate without sharing their phone numbers.

The company has opened early reservations for usernames, which will be officially rolled out later this year.

WhatsApp said the move is aimed at enhancing user privacy, particularly in group chats or when connecting with new acquaintances, by eliminating the need to exchange phone numbers.

The government is examining the legal framework and provisions in the law as it scrutinises WhatsApp's proposed username feature over fraud and impersonation concerns, according to sources.

The government is likely to send a notice to WhatsApp seeking full details about the features and question its implications and the company's plans. Law enforcement agencies may also examine the issue, an official said.

WhatsApp’s latest move has also triggered widespread concerns.

Faisal Kawoosa, Chief Analyst and Founder at Techarc, noted that while phone numbers offer a layer of verification, usernames can be misleading.

"While celebrity names have been reserved, it's still easy to impersonate, and we have seen how verified accounts have worked on X. Fraudsters can easily use some variations which commoners won't be able to catch easily," Kawoosa said, adding that public trust in WhatsApp as a safe platform for communication is likely to decline.

Calling the feature "both a boon and a bane", Abhilash Kumar, Lead Research Advisor at Smart Analytics Global, said it will reduce the chances of ending up on spam lists.

"Users will no longer need to share their primary contact number for every business discussion or negotiation, helping protect their privacy and reducing the chances of ending up on cold-calling or spam lists." However, he warned that it could dilute identity authenticity.

"WhatsApp should internally map usernames to the underlying phone number and introduce robust identity verification mechanisms," he suggested.

Nikhil Narendran, Partner (TMT) at Trilegal, noted that while reserving handles may protect celebrities, the larger challenge is protecting ordinary users and small businesses.

"Trust is shifting from a visible telecom identifier to a platform-managed identity. Banks and businesses will need to rely more on verified business accounts, in-app verification, digital signatures and customer education, rather than assuming that a phone number is sufficient proof of identity," Narendran said.

Users may assume a familiar-looking username is genuine without noticing subtle variations, substantially increasing the chances of spoofing.

Prachir Singh, Senior Analyst at Counterpoint Research, pointed out that the feature reduces a simple layer of accountability, as users can no longer verify someone's identity by simply calling their number.

"Although WhatsApp has introduced safeguards such as the optional username key and reserved usernames for public figures, lookalike usernames and impersonation will remain challenges. Going forward, stronger impersonation detection and more visible verified accounts will be essential, especially for banks, businesses, and government agencies," Singh added.

Paytm founder and CEO Vijay Shekhar Sharma has warned that lookalike usernames could become a major vector for impersonation and scams if not properly protected.

Prominent Indian startup founders and public figures also took to social media platform X to express concerns regarding the potential for abuse of the feature.

MobiKwik CEO Bipin Preet Singh strongly opposed the update, calling it "not a good idea at all".

He noted that it would lead to a proliferation of fraud and impersonation, revealing that most variations of his own name were already taken during the early reservation phase.

Author and entrepreneur Ankur Warikoo warned that the feature could be a "disaster" in India if the right anti-abuse systems are not established.

Highlighting how scammers could use subtle variations of a username to solicit money, Warikoo said, "Most people don't understand verified status... So, forgive me, if from a public figure's standpoint, this feature raises some serious concerns".

Rajeev Mantri, founder and Managing Partner of Navam Capital, called it a "colossal data harvesting and data pooling scheme".

"Meta's objective is to get you to link social accounts across WhatsApp and Instagram to move the needle on ad targeting and thus improve engagement and revenues. They are playing on consumers’ FOMO to quickly grab the username of choice. Clever."

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