UK competition regulator finds PayPal / iZettle merger problematic

Maria Nikolova

The CMA believes that PayPal’s takeover of iZettle could result in higher prices or reduce the range of services for customers.

PayPal’s $2.2 billion takeover of Swedish mobile payments company iZettle has raised the concerns of the UK Competition and Markets Authority (CMA). The regulator has found that the deal could lead to higher prices or reduce the range of services for customers.

Let’s recall that the deal, which completed in September this year, brings together the two largest suppliers of mobile point of sale devices in the UK.

A brief notice by the CMA on the page dedicated to the PayPal Holdings, Inc / iZettle AB merger inquiry says:

“The CMA has decided, on the information currently available to it, that it is or may be the case that this merger has resulted or may be expected to result in a substantial lessening of competition within a market or markets in the United Kingdom. This merger will be referred for a phase 2 investigation unless the parties offer acceptable undertakings to address these competition concerns.”

In a press release providing more details on the decision, the CMA explains that, after completing its Phase 1 investigation, the regulator has found that PayPal could face insufficient competition in the UK after acquiring its market-leading rival. This raises concerns that the merger could lead to customers, which include small and medium-sized businesses, paying higher prices or receiving a lower quality service.

Furthermore, the watchdog has considered the potential effects of the merger on the emerging market for ‘omni-channel’ payment services, where PayPal has already gained a strong position. The investigation concluded that had iZettle not been taken over, it could have provided significant competition for PayPal and would have potentially benefitted customers by supporting future innovation and lower prices.

Andrea Gomes da Silva, CMA Executive Director, said:

“While iZettle is a relatively recent entrant to payment services, it has already established a market-leading position in mobile point of sale devices and was well-placed to compete against PayPal in other emerging markets. That’s why we are concerned that PayPal’s takeover could lead to higher prices or reduce the quality of the services available to customers”.

If the merging businesses are unable to address the CMA’s concerns, the merger will be referred for an in-depth Phase 2 investigation, which will be conducted by a group of independent CMA panel members.

Read this next

Digital Assets

BlackRock digs further into crypto with metaverse ETF

BlackRock, the world’s largest asset manager with almost $10 trillion in AUM, is set to launch a new metaverse ETF to help investors securely monetize on the booming immersive version of the internet.

Digital Assets

Binance wins license in New Zealand as rival Huobi shutters derivatives

Binance, the world’s largest crypto exchange by traded volume, has obtained licenses to operate in New Zealand, even after rival Huobi shutdown derivatives trading last month due to concerns about regulations.

Retail FX

Hong Kong busts perpetrators of ‘ramp and dump’ scam

Hong Kong’s financial watchdog, the Securities and Futures Commission (SFC), has charged thirteen suspects of market manipulation in a joint operation with the local police.

Institutional FX

TradingView integrates market data from German Tradegate exchange

TradingView announced that it ‎has increased data coverage to allow its users to receive information from ‎and get free access to the intra-day and tick data from Tradegate Exchange.

Retail FX

Spotware Systems introduces Custom Push Notifications for cTrader mobile apps

Spotware Systems, a technology provider for the electronic trading industry, is introducing a new push notification feature to alert mobile users of price swings and market fluctuations through their cTrader app.

Market News

The Week Ahead: 30 September from David Madden, Market Analyst at Equiti Group

Sterling dominated the headlines last week, as there were concerns the UK government might struggle to service its debt.

Inside View

How does the quality of signal providers affect your business?

A must-have onboarding process for brokers with investment services like PAMM, MAM, or copy trading


DBS deploys Nasdaq Trade Surveillance

“The confidence that markets and our clients have in DBS as a safe and trusted banking group is anchored on our ability to detect and respond to anomalous activity, which in turn calls for a robust surveillance and prevention infrastructure.”

Industry News

SEC charges Justin Costello and David Ferraro for securities fraud and posing as billionaire veteran

The Securities and Exchange Commission charged Cannabis executive Justin Costello and David Ferraro, an associate of Costello’s, for promoting the stock of several microcap companies on social media without disclosing their own simultaneous stock sales as market prices rose.