What does the future of Irish banking look like?

The future of banking in Ireland is evolving, driven by technological enhancements including AI, consumer appetite and new participants in the sector.

Over the past 20 years, many foreign players left, some domestic ones collapsed and new competition is coming in digitally.

This week the High Court heard a case regarding approving the €1.6 billion takeover of PTSB by Austrian financial and banking group BAWAG.

It's one year since its board announced the start of a Formal Sale Process.

Commenting this week, PTSB Chief Executive Eamonn Crowley said: "The bank’s proposed sale to BAWAG is progressing as planned with completion expected in Q4 2026/Q1 2027 subject to court and regulatory approval."

Looking back to pre-global financial crisis times, there were at least 12 banks.

Arguably that was too many for a country of our size and population, according to Denis McGoldrick, Head of Financials Research at Goodbody.

Since then, he said there has been "a period of consolidation".

PTSB was one of three Irish banks that survived the banking crisis.

Bank of Ireland and AIB also survived and remain active today

The other three main Irish banks and building societies covered by the 2008 Irish government bank guarantee were EBS, Anglo Irish Bank and Irish Nationwide Building society.

EBS was later bought by AIB in 2011, while Anglo Irish Bank and Irish Nationwide Building Society (INBS) suffered massive collapses, merged, and were eventually wound down through the Irish Bank Resolution Corporation.

Foreign lenders that left the Irish market include Ulster Bank, Danske Bank, KBC, Bank of Scotland Ireland, Rabbo Bank, Leeds Building Society and Nationwide UK.

Now, once again, there's more competition in the market, especially when it comes to offering mortgages, while foreign competition is coming in digitally with the likes of Revolut, Monzo, N26, Bunq, and Avant Money to name a few.

Credit Unions are also moving into the mortgage space in a larger capacity since the Central Bank relaxed their regulatory requirements.

In terms of trust, especially among Irish people, Credit Union have the highest trust scores and top surveys every year, above the pillar bank, meaning they could do well in mortgage lending.

The government’s 2026 Consumer Sentiment Banking Survey, published this week, shows that 86% of consumers identify AIB, Bank of Ireland or PTSB as their main provider.

The survey found that almost half of consumers (48%) now report holding an account with Fintech Revolut, up from 43% in 2025.

Revolut says it now has around 3.4 million customers in Ireland.

The survey said that while Revolut continues to be used mainly for money transfers, 6% of respondents now identify it as their main financial account, compared with 3% last year.

This annual survey was undertaken by Ipsos Behaviour and Attitudes (B&A) on behalf of the Department of Finance and involved face-to-face interviews with more than 1,500 people.

Revolut doesn’t currently offer mortgages here, while plans to roll out an offering have been delayed.

"I think Irish consumers in particular favour the bricks and mortar approach, particularly when it comes to the lending side of things," said Mr McGoldrick, "we haven't yet seen FinTech successfully break the mould when it comes to lending."

The majority of Irish customers continue to get their salary coming through one of the pillar banks.

Then, monthly they'll transfer their spending money into a Revolut account and use it that way.

"From a banking perspective, it's that salary piece that's the real hurdle for the fintechs. And for now, Irish customers just don't have that same level of trust," he said.

"That's not to say that trust in the likes of Revolut and other fintechs won’t build over time.

"Younger consumers in particular are unlikely to have the same loyalty to the traditional pillar banks, simply because many of them may never have had a relationship with one."

In March this year the three pillar banks AIB, Bank of Ireland and PTSB launched Zippay to allow person-to-person instant mobile payments.

It uses mobile numbers saved in the customer's contact list to identify who else uses the service.

The service was introduced to rival FinTech banks such as Revolut and N26, and to have a competitive offering in the digital space.

All banks regardless of how they deliver their services are required to meet the same strict consumer standards, according to the Central Bank of Ireland.

A spokesperson for the bank said that digital banks offering products and services in Ireland through an app, are fully authorised banks and must go through the same rigorous licence application process as a traditional bank.

"The Central Bank of Ireland’s Consumer Protection Code focuses on real, practical safety steps that protect everyday consumers. This means that whether you bank online, through an app or in a local branch, your bank has a strict legal duty of care to look after you and your money."

Under European rules, a bank licensed in another EU country can legally offer its services here in Ireland.

This is known as a 'passport' system, and it ensures that passporting banks are subject to the same rigorous regulatory regime as traditional Irish banks.

The Central Bank spokesperson noted that while technology may change how we manage our money, it does not change the regulatory requirements banks must adhere to.

As the landscapes continues to evolve Mr McGoldrick believes the banking sector is in a position of strength with pillar banks having surplus levels of both capital and liquidity.

"They have plenty of firepower to lend into an economy that's set for at least a decade of growth when you think about things like the National Development Plan and the significant level of money that the government is pumping into the housing sector.

"We also have a mortgage market which is set to continue to grow over the next several years.

"The banks are in a very strong position, and I think that's why the likes of BAWAG, who are very shrewd operators, are looking to buy PTSB and come into this market."