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	Saturday 24th February 2024

Instant Mobile App Service Scrapped: What Happened?

Synch Payments DAC (the service offering mobile account payments in Ireland) retracted its plans to launch its payment app called Yippay. A spokesperson for Synch also said that their operations will be stopping entirely.

AIB, Bank of Ireland, KBC Bank Ireland, and Permanent TSB were the four partners involved in establishing Synch to offer Ireland with a mobile payment app. They had a simple vision in mind to provide Irish people with an instant way to transfer funds conveniently on their smartphones.

This plan was initially launched three years ago with lofty goals to be bigger than Revolut in Ireland. So what happened, and is the Irish mobile payments app going to be revived? Let’s take a look at all the details below.

Why The Plans Were Scrapped

Three years after Synch announced plans to provide Ireland with a mobile payment system, the project came across too many setbacks to make it a realistic option. However, the Irish government lacked expertise in instant payment systems.

Along the way, Synch faced a few issues when it came to obtaining approval from the Competition and Consumer Protection Commission, also known as the CCPC. One of the reasons for the rejection was the lack of sufficient information. The CCPC didn’t feel confident that the information provided by Synch was intended to acquire or merge with the upcoming SEPA Instant plans.

The CCPC escalated the issue and carried out a more in-depth analysis, which provided Synch with the clearance to proceed. But that victory was short-lived because the Central Bank later informed Synch that they would need authorization to be both a payment service provider and an account information provider.

This was a massive blow to the company because this extra step could extend the timeline for completing the project by several years. That was simply time that they did not have. The Central Bank remained firm in its position on requiring Synch to be authorized as a payment and account information provider.

They made a statement informing people that they have strict authorization protocols in place to ensure consumers and their finances are protected. The Central Bank also made it abundantly clear that they weren’t targeting Synch specifically by saying that these regulations are a must for all payment service providers. Synch, unfortunately, did not even make it to the application process with the Central Bank.

This setback turned out to be a significant gain for Revolut, which holds a substantial market share among instant mobile payment providers in Ireland. It has 1.7 million customers out of an Irish population of five million. Today, through the Revolut app you can take out funds from casinos with instant withdrawal, make online purchases, or just transfer money to other users.

What’s the Future of Irish Mobile Payment Apps?

SEPA (Single European Payments Area) was introduced in 2008, but it wasn’t until 2016 that it was widely accepted in both Euro and non-Euro countries. The UK’s version is Faster Payments, which was established in 2008, allowing for instant or same-day bank transfers. SEPA Instant is a system that enables businesses and consumers to transfer funds in euros within seconds, provided that the recipient is situated in a European country.

This payment system is being designed to be fast, affordable, and safe for consumers and businesses. The European Central Bank and the European Commission are working to promote SEPA Instant across Europe. SEPA Instant in the Eurozone currently has just 14% in the market of SEPA transfers, which is why the ECB and EC are trying to make such a big push for it.

This has changed the technological landscape for instant payment providers in Ireland, and Synch was too late to launch their app and be a part of the change. The digital euro that the ECB is developing will take a couple of years to launch, but plans are being put into action. The two years in preparation will be spent on testing and acquiring partners.

Conclusion

Whilst the Synch project is dead in the water, the SEPA Instant plans look promising. The project is aiming to launch in a couple of years and provide businesses and consumers with fast and safe money transfers. Despite sinking €5 million into the Synch project, the three banks involved decided that the timeframe of 3+ years to launch the app was too long.

They didn’t want to wait for lengthy approvals from the Central Bank. They attempted to explore other options, but nothing has yet come to light, and all signs point to Synch being no longer a viable option.