MADRID/MILAN (Reuters) - Three leading payments companies in Spain, Italy and Portugal on Thursday said they would team up to allow users in the three countries to make instant mobile payments, in a push to help to develop a unified European payments market.
The letter of intent for the accord was signed by Spanish mobile payment firm Bizum, Italy's ATM machine operator Bancomat, which runs online payment service Bancomat Pay, and Portugal's SIBS, owner of mobile payment supplier MB WAY.
The three companies jointly said their accord was open for other European payments providers to join in at a later stage.
Bizum, Bancomat Pay and MB WAY provide person-to-person and person-to-business payments to 42.7 million people in the three countries, who in 2023 made a total of 1.47 billion payments.
Europe's payments market is still fragmented and financial industry supervisors have been calling for more innovation and standardisation across countries.
European companies face competition from U.S. rivals, which include fintech giants such as PayPal (NASDAQ:PYPL) or incumbents such as MasterCard and Visa (NYSE:V).
The three companies said that their goal was to allow users to make person-to-person payments already in 2024, and then expand the range of payments they provided through their systems.
Bizum CEO Angel Nigorra said in the statement that digital payments were spreading fast and that to address people's payment needs across countries "interoperability between markets" was essential.
EU electronic payments totalled 240 trillion euros ($258 trillion) in 2021 from 184.2 trillion euros in 2017, boosted by the COVID-19 pandemic, according to the European Commission.
"We hope that this is just the first step for users to have a ... universal mobile payment method for their everyday transactions," he added.
In Spain alone, Bizum has more than 25.3 million active users, with 38 affiliated banks such as Santander (BME:SAN) and BBVA (BME:BBVA), and works with 52,400 outlets.
Highly dependent on consumer spending, the payments sector has seen investors grow increasingly cautious as Europe's economy weakened amid higher interest rates, with top player Worldline's regulatory woes also weighing.