The Dutch Authority for Consumers & Markets (ACM) published a report about the risk of exclusion of fintech companies on the market for payment services (the Report). In the Report, the ACM warns banks that it will monitor this market closely in order to counter such exclusion.

The ACM makes a difference between “front-end fintech companies” and “end-to-end fintech companies” in its Report:

  • front-end fintech companies offer payment initiation services and/or account information services (e.g. an app that allows you to monitor personal expenditures); and
  • end-to-end fintech companies primarily involve fintech companies who offer closed payment platforms (e.g. Paypal).

Exclusion of front-end fintech companies

The ACM states that there is a genuine risk that front-end fintech companies may be excluded by banks as front-end fintech companies require bank account information from banks while these banks also potentially compete with front-end fintech companies.

Dutch and EU competition law prohibits the abuse of a dominant position. The ACM is of the opinion that it is likely that individual banks possess a dominant position in respect of bank account information of their own customers. Banks may abuse that dominant position by refusing to supply this bank account information to front-end fintech companies.

Exclusion of end-to-end fintech companies

A customer of an end-to-end fintech may want to transfer money from a closed payment platform to a bank account. Therefore, end-to-end fintech companies require access to a bank account (to transfer this amount from its own bank account to the bank account of a customer). As there are many offerors of bank accounts, the ACM thinks that there is only a minimal risk that end-to-end fintech companies could be foreclosed where access to a bank account is concerned.

The Report observes that Dutch legislation implementing the new Payment Services Directive II allows the ACM to monitor whether rules governing the access of payment service providers (including fintech companies) to payment systems (including bank accounts) are objective, non-discriminatory and proportionate.

Competition authorities closely monitor the exclusion of fintech companies

The ACM emphasises that it could use its powers to counter the exclusion of fintech companies. In this respect it is useful to note that the European Commission carried out unannounced inspections in relation to the same subject two months ago (reference is made to our earlier Bankbit).