The UK has opened a fresh probe into digital wallet competition. UK regulators are investigating whether Mastercard, Visa, and PayPal engaged in anti-competitive conduct. The review focuses on agreements linked to the funding and use of PayPal’s digital wallet in the British market.

The investigation is being led by the Financial Conduct Authority. The regulator said it has not reached any conclusion about whether competition law was broken. However, officials are now examining whether contractual arrangements may have limited competition among digital wallet providers.

Mastercard said it received an information notice from the FCA. The notice asked for details about its contractual relationship with PayPal. Furthermore, a company spokesperson said Mastercard aims to meet the highest standards of competition law. The company added that it will cooperate fully and transparently with the regulator.

Meanwhile, Visa also confirmed that the FCA informed it about the inquiry. The company said the investigation concerns contractual provisions related to the PayPal digital wallet. Likewise, Visa said it is cooperating with the watchdog. PayPal declined to comment in detail because the investigation remains active.

Digital wallet use has grown rapidly across the UK. Last year, the FCA and the Payment Systems Regulator said the share of card transactions made through digital wallets rose to 29 percent. In 2023, that figure stood at only 8 percent. As a result, digital payments have become a major part of daily consumer spending.

Earlier, in February 2025, UK regulators said businesses had called for stronger competition in the sector. They said better market access could help new companies enter the digital payments space and encourage innovation. In the end, this UK digital wallet probe could shape how Mastercard, Visa, and PayPal compete in the future.