Ireland’s banks gave up on the idea of creating a mobile payments application

Irish banks have decided to drop their plans to launch a mobile payments app due to a number of regulatory holdups and obstacles. The current payments landscape is evolving, and the changes are too common and fast for them to launch a regulatory-compliant application at this time.

App’s developers announced they are abandoning the project

Initially, the banks tasked a company called Synch with creating an app for transferring money, known as Yippay. The company was supposed to create the app on behalf of several banks, including the Bank of Ireland, AIB, as well as Permanent TSB. The banks wanted something user-friendly and convenient that would allow them to take on neobank competitors such as Revolut.

However, a recent press release published by Synch stated that Synch Payments DAC, the Irish instant mobile account-to-account payments service, has decided to give up on the creation and launch of the app. The firm said that after careful consideration and review of its business plan, it has reached a decision that it is no longer feasible to proceed with the app’s development, which is why Synch will cease operations.

The company added that the decision was made due to a combination of factors that have contributed to a prolonged time frame to launch, and as a result, the original proposition is no longer viable.

The project’s initial aim was to provide banks and financial institutions with their own service that would allow merchants to receive account-to-account payments for e-commerce and PoS transitions while also providing the shoppers with an effective mobile-only user experience.

The banks were even willing to commit 5 million EUR to the joint venture, as well as team up with Italy’s Nexi, who acted as their technology partner. Unfortunately, the project has encountered a series of challenges since its inception, including a series of delays and major changes in the market dynamics.

Market challenges that halted Yippay’s development

Back in July of this year, Ireland’s central bank told the company’s team dedicated to the project’s development that the app would require regulatory approval pursuant to the European Union Payments Services Regulation 2018 before it could even launch, and the process of getting it takes about a year even under the best circumstances.

Meanwhile, the EU authorities have pushed through several proposals that would have had a massive impact on the availability and affordability of international instant payments across the bloc.

Finally, the commercial space is emerging via the Sepa Payment Account Access scheme, which is expected to enable open banking-based account-to-account payments to Europe’s e-commerce sector, which also led to questions about how competitive Synch’s product would actually be, even if it was able to launch.