Telefónica is joining forces with Spanish banks CaixaBank and Santander to create a joint venture to develop new digital businesses in mobile banking, including a mobile wallet. In what it's billing as the first European alliance of telecoms and financial institutions, Telefónica announced Thursday that the venture would start in Spain, targeting the area's 600,000 businesses, with plans to go international in the near future. Its first order of business is building an online community to connect merchants and consumers with offers, discounts and promotions, helping retailers boost sales. The partners also plan to build their own digital wallet for all of their customers' cards and payment needs, both digital and person-to-person via their mobile number. Why this matters
CaixaBank and Santander aren't Telefónica's first partners in the mobile commerce space, but the fact they are actually forming a joint venture makes this the operator's biggest bet on mobile money yet. Provided the venture passes muster with Spain's competition authorities, the combination of banks and a telco working together -- rather than against each other as is often the case -- could be a powerful force in driving mobile commerce into the mainstream. Telefónica says the venture is also open to other partners, although it didn't specify whether it would like them to come from the telecom world, financial sector or elsewhere. For more

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— Sarah Reedy, Senior Editor, LightReading