The United Kingdom Payment Systems Regulator (PSR) Tuesday found five payment companies, Mastercard, allpay, Advanced Payment Solutions (APS), Prepaid Financial Services (PFS) and Sulion, infringed competition law by agreeing not to compete or poach each other’s customers in the UK prepaid card market.

The case concerns the issue of pre-paid cards that are used by local authorities to distribute welfare payments to vulnerable members of society, such as people facing homelessness, victims of domestic violence and asylum seekers. The only payment system that was used for pre-paid cards was Mastercard, and even for the short period Mastercard sponsored and wholly funded the National Prepaid Cards Network (Network) and had public sector members, including Mastercard program managers (PMs).

The PRS concluded that the companies were involved in two market-sharing cartels in violation of the Competition Act 1998. One was a long-term cartel between all five companies that lasted from 2012 to 2018 and the other involved APS and PFS from 2014 to 2016.

The PRS’s current decision was based on the investigation initiated against the companies in October 2017, which was followed by a complaint by allpay against one of the infringements. During the course of the investigation, the PRS also conducted unannounced searches at the premises of some of the parties.

The PRS, in its provisional findings, released in March 2021, found that five companies had an agreement that the PMs connected with different networks were not to poach each other’s public sector customers. The companies also colluded to exclusively allocate the leads from Network promotional events between the Network PMs. Lastly, the separate arrangement between APS and PFS was not to target each other’s public sector customers when a contract was up for renewal, including through a public tender.

The PRS upheld the provisional findings and imposed a fine of more than £33 million on each company for the cartel.