Irish regulators have rejected a bid by leading banks to establish a payment application that would rival existing UK challenger banks like Revolut and N26. In a statement, the Competition and Consumer Protection Commission (CCPC) rejected the bid on the grounds of insufficient information.
The app ‘Synch Payment’ is a proposal of Permanent TSB, Bank of Ireland, AIB, and KBC Bank. The payment platform would allow users to make seamless person-to-person payments within Irish borders.
The CCPC further states that it could not ascertain if the banks’ proposal was a merger or acquisition. The CCPC states that:
“Following a preliminary review of the notification, the CCPC has formed the view that the notifying parties have not provided full details of the proposed transaction as required. As a result, the CCPC has also been unable to determine whether the proposed transaction should have been notified to the CCPC on a mandatory basis. The CCPC has written to the notifying parties informing them of its decision and expressed its willingness to further engage.”
The CCPC adds that it’s open to further engagement with all parties to solve the raised issues.
The Synch Payment project is being coordinated by Banking & Payments Federation Ireland (BPFI). Italian fintech firm Sia was lined up to offer technical support for the proposed application.
Traditional banks under threat
The move by the banks to develop a payment application is part of a broader approach to tackle the rising influence of challenger banks. Notably, UK’s challenger banks are among the main fintech drivers globally.
The proposition by challenger banks of efficiency might lure away customers from traditional banks. As the fintech sector grows, neobanks are looking forward to offering additional services like mortgages.