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Industry roundup: 19 August 2020

European Commission approves acquisition of Nets' account-to-account payment business by Mastercard

The European Commission has approved, under the EU Merger Regulation, the proposed acquisition of Nets' account-to-account payment business by Mastercard. The decision is conditional on the transfer of a license for Nets' “Realtime 24/7” technology for account-to-account core infrastructure services as well as of the relevant personnel and other assets.

The Commission's investigation focused on the markets for the provision of account-to-account core infrastructure services “A2A CIS” and account-to-account payment services “A2A payment services”, where the activities of the Mastercard and the target business mainly overlap in the European Economic Area (EEA). A2A CIS allow to process payments, including real-time payments, directly from one bank account to another, without the need for a card. They can be provided either as a software-only solution or as a managed solution consisting of the provision of the A2A core infrastructure (including the software, together with the hardware and the telecommunication networks and processes), as well as the management and operation of the infrastructure.  

The Commission found that the transaction, as originally notified, would have raised competition concerns in the EEA market for A2A CIS in relation to managed solutions. In this market, both companies have strong positions and the transaction would have led to the strengthening of the leading player, Mastercard. The Commission also found that the parties closely compete with each other, having been shortlisted by customers in a higher number of EEA tenders compared to other players. Finally, the Commission's investigation revealed that the parties face a limited number of credible competitors in the provision of A2A CIS managed services, whereas the market for the provision of A2A CIS software-only solutions is generally more competitive. The Commission was therefore concerned that the proposed acquisition would harm competition and lead to higher prices and less choice in the market for the provision of A2A CIS as managed services.

The Commission's investigation did not identify competition concerns in the various national markets for A2A payment services, which are end-user services/applications to transfer money from one bank account to another, within the EEA. In particular, the Commission found that the companies' activities only overlap in the Nordic region, where Nets' A2A payment business' existing solutions are expected to lose relevance irrespective of the transaction, as they will soon be replaced by cheaper and more innovative solutions.

To address the Commission's concerns, Mastercard and Nets offered to transfer to a suitable purchaser a global license to distribute, supply, sell, develop, modify, upgrade or otherwise use Nets' Realtime 24/7 technology, with which the target business currently competes in A2A CIS tenders. In particular, the purchaser will have access to the licensed technology on an exclusive basis in the EEA and, on a non-exclusive basis, outside of the EEA. The transfer also includes all necessary personnel and services, such as consultancy services and transitional support services, including access to all necessary components and capabilities  to provide managed services based on Nets' Realtime 24/7 technology.

The proposed commitments fully address the Commission's competition concerns, as they will increase competition in the market for the provision of A2A CIS as managed services in the EEA, by allowing a new player to effectively and credibly compete in this space. The Commission therefore concluded that the proposed transaction, as modified by the commitments, no longer raises competition concerns in the EEA. The decision is conditional upon full compliance with the commitments.


TD Bank accounting tool aims to improve small business cash flow

TD Bank has announced that it is launching TD Online Accounting to provide an integrated payment and accounting experience for its small business customers to conduct banking and bookkeeping activities through TD's Small Business Online Banking platform.

TD Online Accounting uses the technology of Autobooks, an integrated accounting and receivables platform that allows business owners to get paid faster by settling credit card and electronic payments directly in their TD Bank business checking account. Accelerating transaction settlement times is especially important for businesses as they seek to maintain a healthy cash flow as a result of COVID-19.

The accounting tool is designed to help businesses increase and accelerate their cash flow by providing a self-service, digital onboarding experience to help business owners get paid electronically. As a payment facilitator, Autobooks enables a business to begin invoicing within moments of enrolment and to start processing payments shortly after. TD Online Accounting is available to current TD business customers with a business checking account who are enrolled in online banking. The solution also helps businesses electronically send invoices, accept payments from any location via a payment link, automatically reconcile all incoming payments, create customisable reports including balance sheets and income statements, keep track of payments, and automatically handle bookkeeping tasks.


Paystand launches prepaid alternative to corporate expense card

Paystand has released the Zero Card, a prepaid alternative to corporate expense cards designed for mid-market businesses that need more flexibility and control over budgets and spending. The card is described as having functionality to support several use cases across expense management, fund disbursement, and bulk card creation.

Using the Zero Card streamlines invoice processing, expense reporting, and payment execution, and allows businesses to manage, track, and control company spending in real-time. The card leverages Paystand's zero-fee payment network to give businesses a fast, secure way to eliminate the cost of transaction fees.

"The current economy has sparked a dramatic focus on working capital. For payments to flow seamlessly, businesses need to move toward cashless digital systems," said Mitch Kitamura, managing director at DNX Ventures. "Paystand's Zero Card is a critical step for connected commerce and will help unlock cash flow for businesses and move the economy forward."

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