Irish banks mobile payments plan hits roadblock

A payments app developed by Ireland’s leading banks to compete with digital bank has announced that the Competition and Consumer Protection Commission (CCPC) will open an investigation.

The Synch Payments joint venture developed the Yippay money transfer app, which included AIB, Bank of Ireland, KBC Ireland, and Permanent TSB.

More than 5.9 million euros were raised to finance the project, according to a file submitted to the commercial register office at the end of November.

The original CPC application was rejected in January due to a lack of data

A second application was submitted to the CCPC in April, which is scheduled to be launched in early 2022 and regulatory approval is pending.

However, the launch may be postponed after the decision to study the competitiveness of the project.

“After a thorough preliminary investigation, the CPC determined that a full investigation is needed to determine whether the proposed transaction could significantly restrict competition in the state,” the agency said.

The CCPC invited other players in the market, including online payment service providers like Revolut, Stripe, and N26, with whom Synch Payments wanted to compete.

The big banks not only fear losing market share in the payments market but also that fintech will create a customer base to offer a wider range of banking services.

Unsurprisingly, the Electronic Money Association, a lobby group that represents Stripe, PayPal, Facebook, and Revolut, called for the plan.

Revolut has had a user base of over 1 million this year despite the UK fintech abandoning plans to set up a European wealth management center in Dublin.

Instead, Revolut has obtained a MiFID license from Lithuania, where it also has a banking license.

In the meantime, Revolut will continue to apply for approval as an electronic money institution in Ireland.

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