• Follows Nov. 26, 2018 CMA concerns over takeover Paypal/iZettle.
• In phase 2 probe the CMA has provisionally cleared Paypal's completed takeover.

Background

• Both companies provide mobile point of sale (mPOS) devices enabling businesses
  to take offline payments through a card reader connected to a smartphone/tablet.
• Both companies are active in emerging market for omni-channel payment services, through which businesses can take offline/online payments through single provider.

Some Phase 1 Concerns

• Paypal’s purchase of rival might reduce competition in UK supply of mPOS devices.
• iZettle’s clients, mostly SMEs, would pay higher prices or get lower quality service.
• Potential impact, omni-channel payment services where PayPal has strong position.

Phase 2 Findings

• Takeover does not raise competition concerns and while iZettle/Paypal are 2 of the largest mPOS device suppliers, customers could switch to traditional POS devices.
• The 2 largest suppliers of payment services to smaller merchants, Worldpay and
  Barclaycard, almost 60% of market, likely continue to constrain merged company.
• Merged company will also face significant competition by other mPOS-only players, such as Square and SumUp, which have both grown significantly in recent years.
• In omni-channel services iZettle would have been able to develop offering slowly.