The CMA said it took into account a broad spectrum of evidence, such as internal documents and input from different rivals, clients and retailers.
The probe mainly focused on how the arrangement could impact competition in the consumer-to-business (C2B) electronic payments sector in which Visa via card-based payments and Plaid via payment initiation services (PIS) are active.
The watchdog determined that “Plaid would have been an increasing competitive threat to Visa in future, but that it is only one of a number of PIS providers already active in the U.K.” It named Token.io, Tink, Yapily and TrueLayer as other firms “already possessing similar, or stronger, competitive capabilities than Plaid.”
“On this basis, the CMA concluded that in the U.K. Visa would continue to face sufficient competition from PIS-enabled payments, and other types of services enabling consumer-to-business payments, after the merger,” the watchdog said.
The CMA also took into account if Visa would have the ability to harness its formidable position in card-based payment to put the competitors of Plaid out of the market by providing an offering of PIS-enabled payments and card-based payment brought together.
“Here, the CMA concluded that the combined Visa-Plaid business would not have the ability to push other providers out of the market, principally because customers often use multiple suppliers for their payment options,” the regulator said. “Rival providers of PIS would also be able to enter into arrangements, such as mergers or partnerships, with other payments providers to acquire customers."
As of Jan. 13, Visa said it would purchase Plaid, which is geared toward the creating of application programming interfaces (APIs) that let clients share their data with thousands of apps, for $5.3 billion.
Separately, in July, Plaid encountered a lawsuit which claims it violated the privacy of users and used clients’ personal information in inappropriate manners for years, according to a northern district of California court filing.
“This copycat lawsuit is baseless and Plaid will vigorously defend itself," the company said in a previous statement to PYMNTS. "Plaid does not sell or rent consumers' personal information, and personal information is only obtained with consent. We firmly believe that consumers should have permission-based access to and control over their financial data, and embody these principles in our practices."