VISA-Plaid deal hits roadblock as antitrust scrutiny looms

By Rahul Vaimal, Associate Editor
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The US-based payment processor Visa’s $5.3 billion deal to buy fintech startup Plaid could see a bit of resistance as the deal which allows the payments giant to acquire a key player in the financial-technology space is under antitrust scrutiny at the U.S. Justice Department. 

The Justice Department has requested additional information on the prospective deal through a petition with a court which will enable it to understand whether the proposed transaction to determine if it is in violation of antitrust law.

Earlier, American business daily The Wall Street Journal has reported that the department could make a decision soon as to whether it will sue to block the deal.

The US government has filed a petition with a U.S. district court in Massachusetts to involve the services of Boston-based consulting firm Bain & Co to share the necessary documentation with the authority for the review which is expected to include details regarding Visa’s strategies around pricing and competition with other debit card networks.

The authority in its statement to the court remarked that Bain was “asserting unsupported claims of privilege over the documents.”

Reports suggest that the Justice Department has been making preparations for potential litigation, including lining up potential witnesses for a trial while no final decision has been made.

Founded in 2012, Plaid is a financial services firm that provides businesses a technology platform with tools and access needed for the development of a fully modern, and digitally-enabled financial system.

The Visa-Plaid deal which was announced in January would allow the payment processor to improve its access to the fintech space.