Insights Magazine from CMSPI
Page 24 | November 2021
CONSOLIDATION SPREADING, ESPECIALLY AMONG ACQUIRERS
The payments industry has seen an uptick in consolidation in recent years, including mergers, acquisitions, joint ventures and partnerships. While the trend has been true across the payments industry, the activity of card acquirers is of particular interest because it has led to the emergence of suppliers that offer merchants the ability to consolidate their card acceptance arrangements across their entire business regardless of location. The emergence of these players has come through “megamergers” where large acquirers have merged with or acquired one another to rapidly increase their market reach and coverage.
For example, Worldline claims its acquisition of Ingenico has led to the creation of the largest merchant acquirer in continental Europe. Similarly, the Italian acquirer and payments processor Nexi has recently engaged in a wave of M&A activity with its acquisition of Intesa SanPaolo’s merchant acquiring business as well as Nets, which had previously merged with Concardis. Like the Worldline and Ingenico merger, this likely significantly increased Nexi’s reach across Europe. However, as important as these megamergers are, acquirers have also focused on acquisitions in certain periphery countries where their
presence might not be as concrete as it is in major European countries. For example, Nexi recently signed an agreement to acquire 51% of Alpha Bank’s merchant acquiring business in Greece. While M&A activity in the acquiring industry does offer merchants the ability to simplify their acquiring arrangements across large chunks of where they operate, there are also drawbacks to this approach. Merchants can lose access to a certain level of local expertise as well as local payment methods, so an optimal payments strategy involves evaluating both the pros and cons of a consolidated solution.
U.S. MAG SURVEY SEES MORE FRAUD AS RETAIL MOVES ONLINE
Reserve data 3 , merchants see over 50% of their ecommerce fraud losses from credit, signature debit or prepaid cards, further underscoring the importance of the Fed’s response to the issue of low PINless enablement.
According to a recent survey by the Merchant Advisory Group and CMSPI, U.S. merchants are losing an average 0.7% of their annual sales to e-commerce fraud. The finding underscores a trend of fraud increasing as retail shifts online and the risk of bricks-and-mortar merchants exposing
themselves to new fraud threats as they develop online capabilities. According to the survey, more than 60% of ecommerce fraud losses occur through the merchant’s website. With PINless debit transactions accounting for just 4.5% of online payments, according to Federal
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