In a move that will no doubt come as relief to Mastercard and VocaLink, the Competition and Markets Authority has today approved the soon-to-be newly merged company’s pledge to dispel monopoly concerns by opening up part of VocaLink’s network to competitors.
The CMA conducted a formal consultation into the proposed merger, which has now been concluded following responses from Mastercard and VocaLink which included proposals to relax the new company’s grip on the market.
VocaLink and Mastercard are currently two of only three providers who have access to the Link ATM system. The agreement struck between the CMA and Mastercard includes opening the network to a new service provider and contributing to the cost of current Link members who that wish to leave to join another supplier.
The full package offered by Mastercard and VocaLink was listed on the official UK Government website as follows:
- VocaLink making its existing network connectivity available to a new supplier of infrastructure services to Link. This could allow a competitor to use VocaLink’s connectivity to members of the Link ATM network, rather than having to build their own;
- VocaLink transferring to Link the intellectual property rights relating to the Link LIS5 messaging standard, which members of the network use to communicate when customers use cash machines; and
- Mastercard contributing to the cost to Link members of changing to a new supplier of infrastructure services to LINK.
Now that the CMA is happy for the deal to proceed, Mastercard is expected to pull the trigger on finalising the deal quickly.
Mastercard initially announced its intention to complete the acquisition of the payments technology company in July 2016, but the CMA quickly announced that it had concerns that the acquisition could create a conflict of interest.
VocaLink was previously owned by 18 banks in partnership, including Barclays, HSBC and Sanander, before Mastercard approached the group with an acquisition proposal last year.
A new report published by Earnix shows findings stating that most millennials will use a single portal to aggregate services from multiple banks with which they have existing customer relationships in the future. The report, The Role of Analytics in the New Banking Age 2017, also states that most banks believe predictive analytics and machine learning will become the most powerful way to win back customers over the next five years.
The Global Business and Spending Outlook looks positive for the B2B payments industry.
BT launches innovative showcase to help financial services create secure digital customer experiences
Get a glimpse into BT’s new banking and insurance showcase at Adastral Park.
Richard Broadbent, General Manager, Banking, Wincor Nixdorf UK/I, explains how customer attitudes to loyalty are changing because of technology.