London, United Kingdom. The Financial Conduct Authority has opened investigations into PayPal, Mastercard and Visa over alleged anti-competitive conduct linked to the funding and use of PayPal’s digital wallet. The regulator said it has not reached any conclusions on whether UK competition law has been breached.
Regulator opens rare competition law action
The FCA, which infrequently uses its powers to enforce competition law among financial services firms, said on Wednesday that it was investigating the three payment companies and had reached no conclusions about whether UK competition law had been broken.
PayPal filing and information requests
The announcement followed a PayPal filing stating it had received notices in March of investigations and related requests for information from the FCA about its contractual agreements with Mastercard and Visa.
All three companies said they were cooperating with the regulator. Mastercard confirmed it had received an information notice from the FCA requesting details of its contractual relationship with PayPal. A Mastercard spokesperson said the company works to meet the highest standards of competition law and would cooperate fully and transparently with the FCA.
A Visa representative said it had been informed by the FCA of an inquiry into contractual provisions regarding the PayPal digital wallet and that it was cooperating. A PayPal spokesperson said the company could not comment further because the investigation is pending.
Growth of digital wallet use in Britain
Digital wallet usage has risen in Britain. The FCA and the Payment Systems Regulator said last year that the proportion of card transactions using a digital wallet had increased to 29% from 8% in 2023.
In a joint statement issued in February 2025, the watchdogs said they had heard calls for better competition among digital wallet providers to allow new players to enter the market and bolster innovation.
How do you think increased competition among digital wallet providers could affect the way you pay in Britain?
