A year after announcing that it had selected Nexi as its technology partner for the rollout of Synch Payments, the Irish Bank alliance has run into further regulator road bumps delaying its launch.
The appointment of a technology partner was a key milestone. The decision was also welcomed after the Competition and Consumer Protection Commission (CCPC) pushed back the group of Irish banks application to set up a joint venture because they did not provide enough information.
In June 2022, the banks were cleared by the State’s competition watchdog to set up Synch Payment, which is aimed at allowing instant person-to-person payments on mobile phones. It is understood the payment app will be called Yippay.
AIB, Bank of Ireland, Permanent TSB and KBC Bank Ireland created Synch Payments – KBC Bank is a shareholder in the venture, but its plans to leave the market could see its shareholding replaced by An Post.
The credit unions are also likely to become part of the new system.
CCPC clearance for the deal is controversial as the main banks are already dominant in this market. Objections to the banking joint venture were lodged by the likes of PayPal and Revolut.
Conditions have been attached to the CCPC approving the deal. These include an instance that competitors like An Post and credit unions have to have access to it.
EU Regulatory Approval
Now more problems have beset the app, after the JV behind the initiative has been told it needs clearance under EU rules.
Synch Payments said it has been informed by the Central Bank of Ireland that it needs “regulatory approval pursuant to the European Union Payments Services Regulation 2018” before it can be used.
“Synch has been engaged with the Central Bank of Ireland for some time to ascertain whether authorisation would be required and welcomes the certainty that the decision brings,” the company said in a statement.
Synch intends to submit an application to the Central Bank for authorisation “as soon as possible with a view to Synch entering the market next year”, the firm said.
“While this additional regulatory requirement pushes out the planned market launch, once approval is in place, it will provide the additional assurance that is increasingly demanded by consumers and retailers of payment providers,” said a statement.
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