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Mobile-commerce: French banks take on Paypal

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Three French banks have joined forces and launched an online mobile payment portal, hoping to challenge Paypal's influence in the country.

BNP Paribas, Société Générale and La Banque Postale, three of the biggest banks in France, have banded together to create Paylib, which will be available to the banks' 23 million customers, both private and institutional.

The app will be on sale from September 24, and is designed with smartphone and tablets in mind. It aims to provide users with a secure, as well as "simple and fluid", means to make online payments, foregoing the need to enter credit card details.

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The French banks' partnership hopes to position itself for the growing mobile-commerce market in France, which grew by 150 percent in 2012, according to Fevard, a French e-commerce association.

BNP Paribas's head of French retail banking, Marie-Claire Capobianco, said the first aim was to reach a "critical mass of users, from both individuals and e-retailers". She added that they were advocating "an open solution, which should allow other banks to join us, either from France or from abroad".

"Our three banks lead an intense cooperation, but we are open to others," agreed Laurent Goutard, head of the retail banking network at Société Générale.

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But other French banks may be unlikely to rally under this one flag. Indeed, three other leading banks already offer their own services, with mixed results.

Crédit Agricole launched its e-payment platform, Kwixco, in June 2011, aiming to have over 5 million users within four-to-five years. But the latest numbers reveal that they only have 450,000 users and 1,200 registered retailers, none of which are on Fevad's top 15 list of e-retailers.

Plus, the Banque Populaire/Caisse d'Epargne partnership has also yielded lukewarm results.

However, Paylib plans to compete on costs, charging retailers a commission below 3 percent, the rate currently charged by Paypal. So far, it has worked — eight of the 15 biggest e-retailers in France, including Showroomprivé.com and plan to carry the app's logo on their websites. Paylib now wants to go further by encouraging their business clients "of all sizes" to register.

(Read more: Don't be afraid, recovery takes time: Soc Gen CEO)

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