Six Polish banks have come together to develop a local standard for mobile payments

The project aims to develop a common infrastructure for mobile payments in Poland. The new authorisation and settlement standard will be available to a wide range of market participants, including other banks and acquirers. The agreement between Alior Bank, Bank Millennium, Bank Zachodni WBK, BRE Bank (mBank, MultiBank), ING Bank Śląski and PKO Bank Polski opens the way to development of the terms of reference and the timetable of the next steps of this project; to be managed by a joint venture to be formed and operated under the supervision of the national financial market regulators.

“The overriding objectives of Alior Bank here is to introduce new standards and to change the rules prevailing in the banking services market. Hence, we could not miss the opportunity of joining the banks who chose to participate in implementation of this extremely important and innovative project”, said Wojciech Sobieraj, CEO of Alior Bank.

“Our customers need to be made aware of the fact that the mobile payments system is not only modern, but also a safe and efficient solution”, said Bogusław Kott, CEO of Bank Millennium; and further added: “This common standard can be an important stimulus to even faster development of the market, thus our participation in this agreement is an obvious choice.”

“We at Bank Zachodni WBK treat mobile banking as the strategic direction of our development. We wish to participate in development of mobile payment systems which have the capacity for becoming a standard and which can offer our customers the widest possible merchant network”, said Mateusz Morawiecki, CEO of Bank Zachodni WBK. “We are convinced that the initiative with estimated coverage of 70% of banking customers in Poland stands a great chance of becoming the generally accepted and used standard”, Mateusz Morawiecki also added.

“We have for years supported innovative solutions with a strong success potential. That is why we have chosen to engage in the joint mobile payments project, a precedent in the Polish market that creates very real chances for this payment method coming into general use, both among over four million customers of BRE (including mBank and MultiBank) and the persons using the services of our partners. In this way we are also joining forces in addressing the new challenges facing the banking sector, such as those brought about by the new payment card regulations and the growing interest in modern mobile banking”, said Cezary Stypułkowski, CEO of BRE Bank.

“Customers expect comfortable, universalised, rapid and secure payment methods. At the same time, as demonstrated by the uptake of the new solutions offer by ING Bank Śląski, such as our mobile banking or proximity ATMs, we can see how rapidly they begin to use these. This points to the market potential in this specific area. That is why we decided to join the project together with other banks aiming to develop a uniform mobile payments standard. We believe that as a result we will be able to provide our customers with the highest quality customer service in the area of daily payments”, said Małgorzata Kołakowska, CEO of ING Bank Śląski.

“The development of a common infrastructure for mobile payments in Poland is one of the elements of our Strategy for the years 2013-2015. The standard will be flexible and open to other market participants, so that the customers making payments via their mobile phones can use that option in the greatest number of places possible, irrespective of who they bank with”, said Zbigniew Jagiełło, CEO of PKO Bank Polski.

By virtue of the innovative character of the project and the system’s low operating costs (below the currently applicable card use rates), development of the local mobile payments standard for Poland will have a positive impact on non-cash turnover in the economy, and effectively on its economic efficiency.

The project is of unique nature as it is for the first time that a project of this type is being developed by the market’s leading financial institutions. Total share of the six banks taking part in the project in the market of commercial banking institutions expressed in terms of the number of their customers with access to electronic banking exceeds 70%. As a result of this agreement, these customers will ultimately be able to: make mobile payments in a wide network of stores, both traditional and internet-based; use ATMs and transfer funds to beneficiaries identified by their telephone numbers. All these functionalities are currently not available together to the users of the existing systems, either local or international. In consideration of the unique benefits for customers and firms, attempts at development of similar standards have been undertaken, among others, in Spain and the United Kingdom, but those involved entities outside the financial sector, primarily telecoms and retail chains.

In March of this year PKO Bank Polski launched IKO, its 4G mobile banking solution, which combines in a single app banking functions (checking of balances, account history, bank money transfers) and payment functions (payment for purchases made in brick-and-mortar as well as internet stores, withdrawal of funds form ATMs, money transfers to a telephone number, or generation of cheques for offline use). The software application is also accessible by earlier generation mobile handsets. IKO is currently used by 40,000 of customers, who have to date executed nearly 70,000 transactions totalling over PLN 16 million.

The PKO Bank Polski mobile payments system, which already operates in the market, will be expanded to include elements enabling connection of multiple partners and will form the basis for operation of the local standard. The system participants will develop the user application software separately.

The project is a joint venture of Alior Bank, Bank Millennium, Bank Zachodni WBK, BRE Bank (mBank, MultiBank), ING Bank Śląski and PKO Bank Polski. None of those institutions will have a dominant position in it.