UK antitrust regulator approves Visa–Plaid deal

The UK’s Competition and Markets Authority (CMA) has found no grounds to block Visa’s acquisition of fintech startup Plaid. The Plaid deal, which works with the cryptocurrency exchange Coinbase and the Abra wallet, is valued at $5.3 billion.

According to the сайте of the United Kingdom government, following CMA’s first-phase review it concluded that the deal would not affect competition in the electronic payments market between consumers and businesses in Britain.

Information about the deal appeared in mid-January this year. Plaid developed the PIS network, which allows users to link different accounts and connect financial accounts to apps. Its users can make real-time payments on merchants’ websites without using credit or debit cards.

The deal will allow Visa to offer users expanded payment capabilities and related services for fintech developers.

The CMA concluded that although Plaid could become a serious competitive threat to Visa in the future, there are other fintech companies with established positions in the country, so the payments giant after acquiring the startup would not be able to claim a dominant position.

The regulator did not identify a threat in a hypothetical scenario in which Visa could push out competitors from the market by using a combined card-based and PIS payment system. CMA noted that consumers tend to use multiple providers when paying, and other providers of similar solutions can enter into similar partnerships.

In July 2020 the processing service Wirex became the first native cryptocurrency platform to obtain licensed participant status in Mastercard’s network.

Earlier Forklog published a piece examining the battle between payment systems and fintech startups, where the implications of Visa’s takeover of Plaid were considered.

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