Irish banks cleared to launch mobile payment service to rival Revolut

The development of the service is aimed at creating an industry-wide banking payment app to take on the likes of Revolut. 

The mobile payments service called Synch is a joint venture between AIB, Bank of Ireland, PTSB and KBC. Picture: Orla Murray

The Competition and Consumer Protection Commission (CCPC) has cleared a new mobile payment service being developed by Irish banks provided they meet a number of legally binding commitments. 

The mobile payments service called Synch is a joint venture between AIB, Bank of Ireland, PTSB and KBC.

The development of the service is aimed at creating an industry-wide banking payments app to take on the likes of Revolut. 

The mobile payments service will be available to customers of banks and other financial institutions participating in Synch.

The app will provide consumers with instant person-to-person payments. It will also facilitate instant person-to-business payments services which can be used by online merchants on their websites, or in retail outlets through the use of QR codes, to enable customers to pay for goods and services. 

Given the considerable market power that the big banks already wield in Ireland, there has been considerable interest in the plans by the banks for a new app.

The four banks initially notified the competition watchdog of their plans in January 2021.

However, that proposal was almost immediately rejected, when the watchdog took the unusual step of ruling that the proposers had failed to provide it with sufficient information.

On April 8 2021, the watchdog said it had been re-notified by AIB, Bank of Ireland, PTSB, and KBC. On May 19, the CCPC asked the notifying parties for further information.

The watchdog then carried out a preliminary investigation of the proposed joint venture and concluded that a full investigation was necessary to establish if it could result in a substantial lessening of competition in the State.

The CCPC’s full investigation identified a number of preliminary competition concerns. In response to the watchdog's concerns, the banks agreed to make several binding commitments to the CCPC. 

Each year, Synch and the founding shareholders must report to the CCPC on their compliance with the commitments.

Following this, the watchdog determined that the creation of Synch Payments would not substantially lessen competition. As a result, the joint venture between the banks was cleared.

Speaking today, Inez Cooper, Managing Director, Synch said: “Over the past two years we’ve all witnessed the rapid growth in the mobile payments market throughout the country. People have become increasingly comfortable paying for goods and services in shops and restaurants with a simple ‘tap’ with their phone. 

"The Synch app provides a secure, instant and frictionless experience for consumers while also ensuring a seamless connection directly to their existing banking provider, delivering efficiencies for businesses," she added.