Facebook is preparing to move into the money transfer business, with a service that could rival established players such as PayPal and Western Union.

The global technology giant is looking for approval for “e-money” status in Ireland, where it has its European headquarters. It could give the business permission to issue digital credits with a real money value.

In the US it already has permission to allow payments with apps such as Candy Crush and Farmville and it created $2.1 billion in transactions to games developers last year.

Steve Edkins, CEO of FusionExperience, said the move highlights how tech firms are disrupting traditional industries with established players.

“The popularity of smartphone devices has aided the shift in the financial services market by allowing companies like Facebook, Google, Apple, Microsoft and Amazon to act as intermediaries and pioneer stored monetary value.

“This evolution has been in progress for some time now and banks are increasingly under threat of being bypassed as digital companies use stored monetary value as a ‘living current account’.

“It is now only a question of time before the banking industry reaches a tipping point where the redistribution of cash liquidity materially impacts banking as we know it today.”