The main national mobile payment providers in Norway, Denmark and Finland are merging with the aim of making it easier to compete on payments with the likes of Apple, Google, Alibaba and PayPal.
Vipps in Norway, MobilePay in Denmark, and Pivo in Finland will join forces to become one of the largest bank-owned mobile wallet groups in Europe with 11m customers and more than 700m annual transactions.
“Competition within payments is global, not local, and we need an even stronger footprint to compete with international players. By combining three of the best-loved brands in the Nordics, and building an even stronger technology platform, we can create world-class payment simplification for all,” said Rune Garborg, chief executive of Vipps.
The three companies allow users to send money to everything from businesses and individuals to school fetes and flea markets from a mobile phone. Users type in a mobile phone number or short code for a business and the money is sent immediately between bank accounts.
Digital wallets first came to Scandinavia through Swish in Sweden, owned by six Swedish banks, but it is not included in the merger.
“We think it is an interesting development that we are following closely,” said Swish, but it declined to comment on whether it was involved in discussions or not.
Swish and Vipps are both now used as verbs in Sweden and Norway to mean sending money, and both countries are becoming increasingly cashless societies.
Payments are a major driver of growth, competition and acquisitions at the moment, with technology groups, fintechs and banks all fighting for market share.
Vipps, which is owned by more than 100 Norwegian banks, will take the lead in the combined group, owning 65 per cent of it, taking both the chief executive and chair roles, and using its technology to expand into Denmark and Finland.
Garborg will become chief executive of the new company and Kjerstin Braathen, head of Norway’s largest bank and current chair of Vipps, will continue as head of the board.
Danske Bank, Denmark’s biggest bank and owner of MobilePay, said it would receive a one-off gain of DKr400m-500m ($64m-80m) assuming the deal is approved by regulators. Closing is expected by the end of 2021 or early next year.
“It is very expensive to compete with global competitors in this space and in order 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,” said Glenn Soderholm, head of personal and business customers at Danske.