Nordic banks are pooling their resources to create a pan-Nordic service built on a single cloud-based IT platform.
If it gets regulatory approval, including from the European Commission, Danske Bank’s MobilePay digital wallet will merge with OP Financial Group’s Pivo in Finland and the Vipps mobile wallet offered by a Norwegian consortium of banks.
The merged business will build a common technology platform from Vipps, which is based in the public cloud and is independent from the consortium. This will enable the participating banks to develop new functionality quicker and keep up with changing demand.
The organisations will create a digital wallet serving 11 million users and over 330,000 shops and web shops. They also want to strengthen product development and innovation through joint working.
Glenn Söderholm, head of personal and business customers at Denmark’s Danske Bank, said: “MobilePay has been a fantastic success. However, it is very expensive to compete with global competitors in this space. To continue to develop the most attractive solutions for our customers, MobilePay must be part of something bigger to gain scale and pool investments for further innovation.”
He said Vipps was the natural choice for a partner. “No partnership would be better than teaming up with Norwegian Vipps – it is the perfect match for MobilePay. At the same time, it is a great strength that Pivo, owned by Finland’s largest bank, OP, will also be part of the merger.”
Final approval for the merger is expected in the second half of 2021 or early 2022. The banks behind Vipps will own 65% of the new parent company – Vipps AS – Danske Bank will own 25% and the OP Financial Group will own 10%.
The MobilePay brand will continue in its current markets and most personal users and businesses will not experience any changes, but new functionality will be available faster, according to Danske Bank.
Claus Bunkenborg, CEO of MobilePay, said: “By bringing a number of well-known brands into the ownership of a joint company, we will be strongly positioned in the market and ensure that we have the necessary scale to continue rapid growth.”
He said the merged entity was open to partnerships. “We want to convey the message to other leading banks and platforms that we are open for dialogue,” said Bunkenborg. “It is especially important for us that MobilePay’s close cooperation with the other Danish banks can continue.”
He said the potential participation of other banks would support its ambition to create a strong European player in payments.
No staff will be made redundant as a result of the merger and Kjerstin Braathen, current chairman of Vipps, will be chairman of the merged operation. Danske Bank and OP will appoint members to the board of directors corresponding to their respective ownership shares.
