Norway Coming In From The Cold As NOK Becomes NPC Scheme Currency

January 14, 2022
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The Nordic Payments Council (NPC) has added the Norwegian krone (NOK) as a scheme currency after P27 exiter Norway took a strategic step to use the Nordic payment scheme.

The Nordic Payments Council (NPC) has added the Norwegian krone (NOK) as a scheme currency after P27 exiter Norway took a strategic step to use the Nordic payment scheme.

On January 1, NOK became a currency in NPC payments schemes, along with existing currencies the Danish krone and the Swedish krona.

The decision follows the reinstatement of Bits, the operator of Norway’s payments infrastructure, as a founding member of the NPC in December 2020.

“The reinstatement of Bits in NPC represented a commitment from the Norwegian payment community to focus on the possibilities in the Nordic collaboration and standardisation by using the NPC payments schemes in Norway,” the council said.

The NPC was founded in 2018 by the bankers' associations in Denmark, Finland, Sweden, and Bits in Norway with the dual objective to harmonise payments in the Nordics and, at the same time, to harmonise the Nordic payments market with the eurozone.

Although Bits was originally a founding member of the NPC, which would have warranted the need to add NOK to the NPC schemes, it withdrew from active participation in NPC after one year into the project.

The move followed Finance Norway’s decision to pull out of P27, an initiative by the region’s largest banks to build a pan-Nordic multi-currency payment infrastructure.

Named after the 27m citizens of the countries in the Nordics, P27 is a collaboration between Danske Bank, Handelsbanken, Nordea, OP Financial Group, SEB and Swedbank.

After Norway withdrew from the P27 project, “we had a strategic discussion saying that it is most beneficial for the banks in Norway to use the Nordic schemes”, Eivind Gjemdal, CEO of Bits, told VIXIO.

Given the renewed commitment among the Norwegian banking community towards further inter-regional cooperation, it raises the prospect that they could also reinstate their interest in joining P27.

However, according to Gjemdal: “While we do not exclude any options in the future, we are not planning to do so for the time being.”

Meanwhile, P27 executives have expressed on numerous occasions their views that they would welcome Norway to rejoin the initiative. As former P27 chief executive Lars Sjögren said he did not know why Norway was not on board and that when it had been, it was a driving force.

At present, P27 is focusing on the currency and scheme rollout and, according to Martin Georgzen, P27 chief strategy officer, the project is moving ahead with full speed in Sweden and Denmark.

Last week, Denmark approved a new sector plan to replace Finance Denmark with P27 as the country’s clearing house.

As regards to Finland, the fourth country in the pan-Nordic project, Georgzen said it is “very much up to the banks’ priorities about when and how” they come along with the project.

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