ACCC Chair Rod Sims. Source: Joel Carrett/AAP Image via AP
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  • After accepting a court-enforceable assurance given by the parties, the ACCC approves the proposed merger of BPAY, eftpos and NPPA
  • ACCC chair Rod Sims says they do not consider the merge to substantially lessen competition, and will improve eftpos’ debit-based payment services
  • The merging companies signed a court-enforceable undertaking which requires them to do make its least cost routing available and promote it
  • The Reserve Bank of Australia, the regulator of payment systems in Australia, will continue to take action to safeguard the availability of least cost routing

After accepting a court-enforceable assurance given by the parties, the ACCC has approved the proposed merger of BPAY Group Holding and its subsidiaries, eftpos Payments Australia (eftpos), and NPP Australia (NPPA).

Through their separate payment systems, BPAY, eftpos, and the New Payments Platform, BPAY, eftpos, and the New Payments Platform, each provide payment services to consumers and companies.

ACCC chair Rod Sims said they do not consider the merge to substantially lessen competition, and will improve eftpos’ debit-based payment services.

“The ACCC found that, at a high level, the services of the three companies do not compete closely,” he said.

“eftpos is important to the availability of least cost routing, as the only current alternative network to the Visa and Mastercard networks through which debit transactions can be routed.

“Least cost routing allows merchants to choose the payment scheme that processes transactions when consumers use a dual network debit card. This can help to reduce the fees merchants pay for the processing of debit card payments.”

The court enforced undertaking, alongside oversight from the Reserve Bank of Australia, gave ACCC certainty that the amalgamation will not have a significant adverse impact on eftpos’ services or the availability of least cost routing.

The merger parties have agreed to ensure that, for a period of four years, eftpos will do everything in its power to make least cost routeing available and promote it, as well as to maintain the eftpos payments scheme and the eftpos card-based issuing and acceptance infrastructure and services, according to the undertaking accepted by the ACCC.

The merging parties must also guarantee that eftpos and NPPA create and make available a set of Prescribed Services within agreed-upon timelines, according to the commitment.

These Prescribed Services include fraud protection measures as well as technological advancements that will allow eftpos debit card payments to be done online and in-app.

By the end of June 2022, the merger parties have pledged to ensure that BPAY, eftpos, and NPPA have agreed on an industry-wide standard facilitating payment using QR codes. This will be done in collaboration with Australian Payments Network, the country’s self-regulatory organisation and payments industry association.

The Industry Committee and Australian Payments Plus chair Robert Milner welcomed the authorisation, saying the merge will create a more innovative and efficient entity that is better able to compete against international card schemes and big tech.

The three companies and brands will continue to exist, but they will report to a single AP+ Board, with efforts are ongoing to recruit the AP+ Board and bring the three companies’ personnel together.

The four main banks already own a majority stake in eftpos, BPAY, and NPPA, and they will continue to own a majority stake in the new combined business.

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