Digital payment shift draws ACCC's attention

The ACCC has flagged a focus on competition in payments markets, investigating allegations of anti-competitive conduct, and protecting the interests of consumers, as part of its financial services enforcement and policy work.

The move was flagged by  ACCC Chair Gina Cass-Gottlieb in a speech to an Australian media conference earlier today.

“Payment systems, services and competitors are rapidly evolving,” said Cass-Gottlieb said.

“We are committed to promoting and protecting competition in this important sector, particularly in the face of these rapid developments, and will take strong action to address any anti-competitive behaviour.”

Earlier this week the ACCC instituted proceedings against Mastercard for allegedly engaging in anti-competitive conduct with the purpose of substantially lessening competition in the supply of debit card acceptance services.

In that instance, the ACCC alleges that in response to the least cost routing initiative, Mastercard entered into agreements with more than 20 major retail businesses that gave these businesses discounted rates for Mastercard credit card transactions, provided they committed to processing all or most of their Mastercard-eftpos debit card transactions through Mastercard rather than the eftpos network.

According to Cass-Gottlieb, “We allege that Mastercard had substantial power in the market for the supply of credit card acceptance services, and that a substantial purpose of Mastercard’s conduct was to hinder the competitive process by deterring businesses from taking advantage of least cost routing to use eftpos for processing debit transactions.” 

“Our case against Mastercard highlights that the ACCC will be vigilant about attempts to reduce the impact of regulatory reforms designed to enhance competition - in this case, the Reserve Bank’s ‘least cost routing’ initiatives.”

“We are committed to supporting the Government’s consideration of competition issues and working with the Government to ensure that the regulatory framework for payments is designed to facilitate dynamic and innovative markets and good consumer outcomes.”

The ACCC chair also highlighted its consideration of competition issues which arise in connection with the shift towards digital payments, including through the ACCC’s Digital Platform Services Inquiry.

She also touched on other areas where the ACCC has been working alongside other regulators and industry to promote competition and enhance consumer protections. These include measures to help disrupt financial services scams, including cryptocurrency scams, and the ongoing rollout of the Consumer Data Right to within the banking sector and soon to other sectors.