BoI is stumping up half the funding for the two year research project, with regional economic development agency Enterprise Ireland contributing the other EUR250,000.

The funding will be provided to UCC's Financial Services Innovation Centre (FSIC) and the initiative is expected to result in the creation of six new research positions.

The bank says it has already agreed several research streams with the FSIC, including the secure delivery of financial services and the integration of self-service systems in branches.

The project will also look into the use of technology to increase operational effectiveness in branches and to manage document handling across branch networks.

Says Ciaran Murphy, leader of the research team, FSIC: "The financial services industry has the highest proportion of spend on IT system and process projects globally and it is important they leverage this spend to provide new and enhanced services to their customers while lowering their internal costs where possible."

Ireland's minister for enterprise, trade and employment, Micheal Martin, says the collaboration project is the first in Ireland involving a financial services company.

"Bank of Ireland will benefit from tailored, researched solutions to their specific technological challenges while the researchers in the FSIC will build up their cumulative knowledge of the needs of companies in the banking sector and bring them to bear on future projects ," he adds.

Richie Boucher, chief executive, retail financial services Ireland, BoI, says: "Funding for innovation research, under the auspices of the FSIC, is an exciting and important initiative for building on and improving our service to customers and to the wider financial services marketplace."