eftpos, NPP and BPAY offer three-year guarantee to get merger over the line

Eftpos, BPAY and the New Payments Platform (NPP) have offered up a court enforceable undertaking to address industry fears that its proposed merger will weaken payments competition.

The Australian Competition and Consumer Commission (ACCC) on Friday began seeking views on the undertaking, which would see the merged entity, Australian Payments Plus, maintain current levels of service for at least three years.

Merchants, particularly small businesses, are concerned any merger will see a reduction in investment and support for eftpos, and a decrease in the availability of least-cost routing (LCR).

ACCC Chair Rod Sims said eftpos plays an “important role in maintaining competition in the routing of debit card payments, which are an important part of Australia’s payment landscape”.

“We are interested in the views of merchants and other industry participants on how this undertaking would impact competition in payment services,” he said.

The undertaking, which was recieved by the ACCC this week, proposes obligations on Australian Payments Plus to ensure eftpos maintains LCR and the eftpos payments scheme and card-based issuing and acceptance infrastructure for three years.

Eftpos and the NPP would also be required to develop a set of “prescribed services” within agreed timeframes and all three organisations must create an industry standard for payments via QR codes by the end of June 2022.

“The obligations in the undertaking are intended to help ensure that eftpos will develop and improve its debit-based payment services for point of sale, online and in-app payments, and person-to-person payments,” Sims added.

The chair of the industry overseeing the merger, Robert Milliner, said the undertaking "directly addresses feedback from payments stakeholders" and reinforces the "commitment to facilitate LCR and maintain eftpos’ services and infrastructure".

Milliner added that he looks forward to continuing to work constructively with the ACCC up until its final determination, which is expected in September.

The ACCC said industry participants have until mid-August to share their views.

The three payment companies agreed to merge late last year in efforts to better compete with growing competition from oversees players.