NPP, eftpos, BPAY Announce Merger to Form ‘NewCo’
(18 December 2020 – Australia) The New Payments Platform (NPP), eftpos and BPAY have agreed to merge as a single entity seeking to reduce costs and take on international payment platforms such as Visa and MasterCard.
Australia’s three major payments infrastructure providers announced their intention to integrate pending approval by the Australian Competition and Consumer Commission (ACCC). The three way merger has already undergone a “pressure test” and is touted to boost access to the payments sector while driving down costs for consumers.
Key stakeholders who will now engage with the ACCC on the proposal to close the deal by H2 2021 after the groups file a formal authorisation application with the ACCC in Q1 2021 provides full details of the proposal and rationale.
The merger will see the creation of a new entity called ‘NewCo’, with a single board governing its operations. NewCo is expected to provide a ‘multi-service infrastructure’ and a unified roadmap that is responsive to change, while continuing the ethos of low acceptance costs. Under the proposed structure, eftpos, BPAY and NPP will continue to be preserved as distinct operations, each with their own operating governance and management schemes.
The proposal also requires that each organisation’s existing payments-related work program remains unchanged until at least the end of H1 2022, inferring eftpos’ rollout of online capabilities and digital identity solution connectID will carry on as scheduled.
“In Australia, international card schemes and multinational technology providers are dominating the payments sector. Change is needed to ensure that the Australian payments system supports the best interests of consumers and businesses, through increased choice and competition” the consortium released in a statement.
“The new entity is needed to ensure an efficient, innovative and competitive domestic payments system for consumers and businesses. The model proposed will enable us to adopt faster to the changing trends of the digital economy, while preserving and strengthening the components of our payments system that so many Australia value and rely on” said Australian Payments Council chairman Robert Milliner.
“eftpos, BPAY and the NPP provide Australians with reliable, safe and affordable payments options every single day. Working towards common goals, they can unlock incredible value, invest more in innovation and realise cost-savings that will ultimately benefit the Australian public” Mr Milliner added.
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