Visa is abandoning its plans to acquire Plaid after the Department of Justice (DOJ) sued over antitrust concerns.
Visa announced in January 2020 its plans to purchase Plaid. While the smaller company is primarily known for a service that allows users to connect their bank accounts to various finance apps, the company was working on a service that would directly compete with Visa’s core business.
As a result, Visa’s move to purchase Plaid, to the tune of $5.3 billion, was widely seen as an attempt to stamp out a competitive threat from a smaller rival. The DOJ was concerned by that, especially given Visa’s dominance in its market, prompting it to file a lawsuit.
According to CNBC, Visa has ended its takeover attempt, a decision the DOJ has hailed as “a victory for American consumers and small businesses.”