The European Commission today announced merger approval for the P27 Nordic Payments initiative to establish its pan-Nordic payments platform. This approval marks a significant milestone for the initiative which is working toward the creation of a common payments infrastructure across the Nordic region.
The merger approval was an essential step for P27, enabling it to be begin preparations for onboarding customers in Denmark, Finland and Sweden. A press release states that P27 will now commence with preparations for pan-Nordic payments services an products, such as the Nordic bill payments service (one pan-Nordic alternative to the current request to pay and direct debit solutions in the Nordics).
The announcement also signifies completion of P27’s acquisition of Swedish clearing house Bankgirot in October 2020, through a newly created joint venture by six Nordic banks (Danske Bank, Svenska Handelsbanken, Skandinaviska Enskilda Banken, Swedbank, Nordea, and OP Corporate Bank). At that time P27 had expected this approval to be finalised by Q1 2021.
The Commission’s update reads that “the transaction gives rise to horizontal overlaps and vertical links between the activities of the companies in the Nordic markets.”
On the announcement, Lars Sjögren, CEO of P27, commented: “This is a major milestone for P27. Over the past three years, we have been building a platform that will transform the payments infrastructures in the Nordics. Our platform will enable domestic and cross-border payments in real-time, in batches and in multiple currencies throughout the Nordic region.”
Martin Andersson, chairman of the P27 board, stated: “The EU Commission’s merger approval means that we are now a major step closer to realising our vision. We are excited to start preparing for onboarding clients in Denmark, Finland and Sweden, and also to proceed and complete the acquisition of Bankgirot in Sweden.”
The Nordics have become renowned for their pace-setting approach to payments, with Mastercard recently finding that the region (alongside the UK) is best placed to make the most of open banking thanks to a high number of bank APIs, progressive regulators, and consumer readiness. The pan-Nordic collaborative models and P27 initiative also aid the region’s readiness for open banking, and most of the big Nordic banks have an open banking strategy, with Nordea Group and DNB Bank among Europe’s frontrunners.
Earlier this year Erik Zingmark, Nordea’s head of transaction banking told Finextra Research that P27 is “building a cross-border, cross-currency real-time payment platform. It is a very good example of banks realising (like the telecommunications industry did some years ago) that we need to share core infrastructure in order to focus on our customers.”
It’s the perfect example, he furthered, of banks coming together not to decrease competition (they’re competing even more than ever, he insists), but to share investments into infrastructure that brings value to society at large. “I hope to see more of this going forward. We see this in the KYC space with utility being created in the Nordics.”