February 13, 2017 / 10:25 AM / in 8 months

Norway banks rally around payments app to fend off foreign competition

OSLO, Feb 13 (Reuters) - More than 100 Norwegian banks will become co-owners of the Vipps electronic payments app in a bid to fend off competition from Nordic rivals and the likes of Facebook, Apple and Google, the banks said on Monday.

** Vipps allows individuals to make free money transfers up to a certain size, and can also be used to make online and in-store payments for goods and services, while companies pay a fee to use it for transactions

** Initially developed by Norway’s biggest bank DNB , which retains a 52 percent stake, Vipps competes with MobilePay, developed by Denmark’s Danske Bank and which is also backed by top Nordic bank Nordea

** “This cooperation better prepares us for winning the race against Nordic and international players,” DNB Chief Executive Rune Bjerke said

“There is an ongoing global revolution in payment services. While we were ahead in the 1980s, that’s no help in countering the competition from Facebook, Google and other platforms,” Bjerke added

** The Sparebank 1 alliance of medium-sized savings banks will take a 25 percent stake in Vipps, while the smaller banks of the Eika alliance will hold 10 percent. Independent savings banks will own 12 percent and Sparebanken Moere 1 percent.

** Sparebank 1’s mCASH payment solution, a competing app, will be folded into Vipps along with its existing customer base, DNB said

** Vipps has about 2.15 million individual users in the country of 5.3 million people, and more than 30,000 corporate customers. On average 204,000 transactions are carried out daily, DNB said.

** Danske Bank last October said it had more than 3.1 million users in Denmark, which has a population of about 5.7 million. Its app had been downloaded some 300,000 times in Norway at the time (Reporting by Ole Petter Skonnord, editing by Terje Solsvik)

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