William Eichler 01 April 2021

Pre-paid card firms supplying councils acted ‘as a cartel’, regulator says

Pre-paid card firms supplying councils acted ‘as a cartel’, regulator says image

Three out of five firms that issue councils with pre-paid cards have admitted to breaching competition rules and agreed to pay maximum penalties totalling over £32m.

The Payment Systems Regulator (PSR) has alleged that Mastercard, allpay, APS, PFS and Sulion engaged in anti-competitive behaviour by agreeing not to poach each other’s clients.

The case relates to pre-paid cards that are used by local authorities to distribute welfare payments to vulnerable members of society.

The regulator alleges that there were two infringements of the Competition Act 1998 that took the form of market sharing or customer allocation. One lasted between 2012 and 2018 and involved all five parties and the other was between 2014 and 2016 and involved APS and PFS.

Chris Hemsley, managing director of the PSR, commented: ‘Pre-paid card services, like these, can provide significant benefits to local authorities as one way to make welfare payments to some of the most vulnerable people in society.

‘By colluding in this way, we consider the parties were acting as a cartel. Because of the reduced competition local authorities may have been missing out on an alternative supplier or products that were either cheaper or better suited to both their needs and the needs of those using the pre-paid cards.

‘Collusion in payments is absolutely unacceptable. Where we see it happening, we will take action, stop it, and seek to impose significant penalties.’

Mastercard, allpay and PFS agreed to settle last month and admitted that they took part in the alleged anticompetitive arrangement. Should the PSR ultimately conclude that there have been infringements, the three companies have agreed to pay fines of £32m.

SIGN UP
For your free daily news bulletin
Highways jobs

Revenue Services Collection Officer

London Borough of Richmond upon Thames and London Borough of Wandsworth
£35,391 - £45,564 per annum
You will be responsible for collecting rent from all tenants of residential and non-residential properties such as garages and store sheds. Rent Collection Service is a customer facing role and we are a first point of contact for our tenants who primarily Wandsworth, London
Recuriter: London Borough of Richmond upon Thames and London Borough of Wandsworth

Registration Service Advisor

Essex County Council
Up to £25081.00 per annum + pension
Registration Service AdvisorPermanent, Full Time£25,081 per annumLocation
Recuriter: Essex County Council

Residential Worker

Durham County Council
Grade 7 £30,024 - £33,699 plus up to £5000 in enhancements
Join a Groundbreaking Team Supporting Families in Seaham Are you ready to be part of something truly transformative? We’re launching The Beacon, a p Seaham
Recuriter: Durham County Council

Multimedia Senior Support Officer

Durham County Council
Grade 7 £30,024 to £33,699 per annum
We are looking for an experienced individual who has well-developed creative writing skills across a variety of different formats and audiences and an Durham
Recuriter: Durham County Council

Residential Worker (Casual)

Durham County Council
Grade 7 - £30,024 - £33,699 pro rata, per annum
Opportunities are available across the County Durham Area We have opportunities available to join the casual pool to work as and when required to pro Durham
Recuriter: Durham County Council
Linkedin Banner