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The battle for mobile payment supremacy in the Nordics is heating up as Danske Bank launches MobilePay in Norway. The app, already used by around 2.5 million people in Denmark, is in direct competition to the recently launched Vipps app from Norwegian bank DNB.
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Although Vipps launched first in Norway, the app drew inspiration from the popular Danish version of MobilePay.
Both apps allow customers of any Norwegian bank to use the service. Once they have downloaded the app, users are required to link a Norwegian mobile number, payment card, bank account and their national identity number to use the service.
The Norwegian version of MobilePay includes all the basic peer-to-peer payment functionality of the Danish version, including the ability to split a bill and request payment, two functions not yet available in Vipps.
MobilePay allows for up to three debit or credit cards to be linked to an account. That’s more than in Denmark because statistics show the average Norwegian owns more than two payment cards.
In the race to provide point-of-sale functionality in Norway, Danske Bank has the edge as the technology is already implemented in Denmark. Mobile Pay is currently accepted at around one in five Danish stores, while a recent deal with PowaTag Technologies will turn any device into an instant point of sale station.
“We will start the implementation of our point-of-sale features in October 2015. From early 2016, our Norwegian users will be able to use MobilePay at all Rema 1000 supermarkets and selected branches of 7/11 and Narvesen convenience stores,” said Sten Vidar Ernestussen, who is leading the Norwegian roll-out of MobilePay.
“For the first time, Norwegian consumers will be able to pay for items with their mobile phone, irrespective of who they bank with and which smartphone they have. Our app is available for iOS, Android and Windows Phone,” he added.
MobilePay topped the Norwegian download charts on launch day, but DNB’s Vipps has since reclaimed the advantage. With more than two million retail customers, DNB has a dominant presence in the Norwegian market, similar to Danske Bank in Denmark.
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The launch was good enough to draw an immediate reaction from DNB, however, which changed its fee structure for Vipps within hours of the launch of MobilePay, which is free to use. The Vipps 1% fee now only applies to transactions above DKK5,000 (£400). As the average transaction value on Vipps is around DKK400, most users will no longer be charged for using it.
“We have almost 500,000 active users, which has exceeded all our expectations,” said DNB’s marketing director, Rune Garborg.
“We know that we will face stiff competition, not just from MobilePay, but other banks to come. Early adopters of Vipps were our younger customers, but the user base is maturing and the percentage of users from other banks is increasing. Our focus now is to increase the user base as much as possible, to make Vipps more attractive for retailers when our point of sale technology is introduced.”