In July last year, MasterCard entered into an agreement to acquire a stake of 92.4% in UK-based payments technology firm VocaLink Holdings for about £700m.
VocaLink is a supplier of payment infrastructure services to 3 major UK interbank payment systems such as Bacs, the Faster Payments Service (FPS), and the Link ATM network.
The watchdog said that a number of industry participants have raised concerns with the transaction.
It investigated a number of theories of harm including loss of competition in payment infrastructure services to Bacs, FPS and Link ATM scheme.
The CMA has found that VocaLink and Mastercard are 2 of the 3 most credible providers of infrastructure services to the Link ATM network operating across the UK.
According to the competition authority, the merger will result in lowering the number of bidders and curtail the ability of the Link scheme to obtain good value when tendering for an infrastructure provider.
CMA Acting Chief Executive and decision maker in this case Andrea Coscelli said: “The Link ATM network provides an essential service for millions of customers.
“It’s important that Link has a good choice of providers when it comes to supplying the necessary infrastructure so it can take advantage of the opening up of payment systems to competition. These concerns warrant a closer investigation in the event that Mastercard cannot address them at this stage.”
The companies have been asked to offer a remedy to address the competition concerns before 11 January 2017 to avoid an in-depth investigation.
Image: VocaLink is a supplier of payment infrastructure services to 3 major UK interbank payment systems . Photo courtesy of Competition and Markets Authority.
