Vipps, BankAxept and BankID Norway will be merged by Norwegian banks to protect themselves from competition of global tech firms.

A group of Norwegian banks, including DNB, Eika and Sparebank 1 Gruppen, announced a preliminary agreement to combine payment units Vipps, BankAxept and BankID Norge in order to improve product offering and prepare for competition against global tech firms.

The deal represents a defensive move from the local banking players, as, according to a press release statement, in a payments market undergoing radical transformation with changes in consumer behavior, technological innovations and the regulatory environment, global players and technology companies like Google, Apple or Facebook, are already present or intend to gain a share of Norwegians’ payments market.

The new company will be established in Oslo by August 2018 and will have 108 employees, the same number employed by the three companies combined. The initiative is subject to approval from the Norwegian authorities.

Vipps, launched in 2014, is a P2P mobile payment app developed by DNB. The service, which provides invoice payments for about 2.7 million users, was spun off in 2017, and is currrently being owned by 106 Norwegian banks, with another four banks involved as distribution partners.

BankAxept cards handles about 80 percent of card payments in Norwegian stores, with more than 1.6 billion BankAxept transactions made by 100,000 users.

BankID is an ID system used by all banks in Norway, as well as about 3.7 million Norwegians.