Visa and Lloyds new deal will see millions of Mastercard customers switch cards

25 June 2024 , 08:16

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Visa has agreed a renewed deal with Lloyds (Image: No credit)

Visa has snubbed its main competitor by securing a new deal with Lloyds Banking Group, which will result in approximately 10 million cards being switched to the payments giant over the next two years.

Visa and Mastercard are the dominant payment firms in the UK, handling 95% of transactions on UK cards. The companies revealed that they have renewed and expanded an existing agreement for Visa to be the primary payments provider for Lloyds, which also encompasses brands Halifax, Bank of Scotland and MBNA.

Visa already supplies payment cards for around 30 million Lloyds accounts as part of a partnership first established 40 years ago. A number of Lloyds customers currently possess debit and credit cards powered by Mastercard.

However, the updated deal means that about 10 million consumer and commercial credit cards will transition to Visa by the end of 2026. The two financial firms also hinted at the introduction of new products for credit card customers to aid their money management, with further details to be disclosed in due course.

Last month, the UK payments watchdog stated that Visa and Mastercard lack sufficient competition in the payments market, and it was contemplating imposing new rules on the two major players. However, the Payment Systems Regulator retracted previous suggestions that it could introduce a price cap to safeguard UK businesses from certain fees set by the providers.

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