According to media reports, Britain’s competition regulator has warned that the United States pay PayPal $2.2 billion acquisition of the Swedish company financial technology start-ups iZettle case could threaten free competition, prompt prices.
A survey by the Competition and Markets Authority (CMA) found it could “face inadequate competition in the UK market” after the US payment giant acquired “iZettle, a leading competitor in the market.”
iZettle, a mobile payment company, was founded in Stockholm in 2010 by Jacob Degil (Jacob de Geer) and Magnus-Nielsen Nilsson.
IZettle for users of mobile phones and other mobile devices to provide payment card reader (can be directly inserted into the base interface), and also provide a series of financial services for small enterprises
In September this year, it completed a merger with PayPal, in order to improve its online merchant business experience.
The matter let iZettle company abandoned the plan public. Jacob, the company’s CEO, said the company had been preparing for the listing for “about a year.” It will be the largest financial technology IPO in Europe.
However, after the merger, iZettle Company will be able to take advantage of PayPal’s 19 million merchant resources.
For PayPal company, the acquisition activity can make it into new markets in Europe and Latin America.
“Although iZettle has not been offering payment services for a long time, it has gained market leadership and is ready to compete with PayPal in emerging markets. ” CMA’s managing director, Andrea Gomes da Silva, said.
“That is to say, we are concerned that PayPal’s acquisition could lead to higher prices for the services they provide to consumers and lower quality of service.” ”
The market for payment services is growing rapidly, supported by new technologies, the regulator said. Therefore, it is now necessary to assess the competitive situation in this market and its impact on consumers.
The first phase of the CMA survey has been completed, and it is concerned that the merger of PayPal and iZettle will reduce the quality of service enjoyed by consumers and have an impact on the emerging “omni-channel” payment market.
CMA said, if iZettle company not be acquired, then it can constantly innovation, in the future and continue to maintain a lower price, so that customers benefit.
If the two companies fail to address the concerns of the CMA, they may be subject to the second phase of the CMA’s in-depth investigation. In September, when the deal announced the deal, the regulatory agency announced related investigation.
In a statement, a PayPal spokesman said, “PayPal will continue to work with the CMA’s investigation. We are trying to address the concerns of the CMA and prove to the agency that the market will continue to be free of competition after we acquire the iZettle company. ”
PayPal said it had more than 200 million active users by the end of last year. Previously, it belonged to eBay, a shopping and auction site. In 2013, it acquired the transfer payment app Venmo.