• UK payments processor Worldpay this week said it was to merge with US company Vantiv. The announcement came as Worldpay reported an 18% rise in first-half revenues to £2.5bn. “The combination of scale and presence that the merger will bring is an exciting step in the creation of a truly global leader in payments,” said chief executive Philip Vantiv.
The deal comes at a time when Worldpay, a leader in the UK market, has moved firmly into global ecommerce: this week it said that part of its business was “the biggest it has ever been and continues to deliver sustainable returns”. Retailers will wonder what difference the merger, which will create a new business that continue to be called Worldpay, will make to their customers’ experience both online and in-stores. The payments company has a track record as an innovator: earlier this year it unveiled what it said was the first UK downloadable card terminal. This comes in the form of a technology app that enables micro-businesses to take physical card payments using their smartphones, without the need for any extra hardware.
• Retailers often ask what they can do to compete with Amazon . The US retailer’s position as the largest UK retailer remains unchallenged thanks to factors including an immense range coupled with innovative technologies and smart delivery solutions that enable shoppers first to find and then to take delivery of the item they want to buy. But the elephant in the room is tax. This week Amazon hit the headlines with reports that it was paying less European tax, even as its sales continue to grow. The Guardian reported that Amazon paid £15m tax on European revenues of £19.5bn, while Amazon UK Services, its warehouse and logistics operation, paid £7.4m in UK corporation tax in 2016, more than half the £15.8m it paid in the previous year.
Opinions are mixed. Oxfam head of inequality Ana Arendar said that “widespread corporate tax avoidance continues to cost both rich and poor countries billions every year that could pay for schools and lifesaving healthcare.” But, over on Forbes.com, commentator Tim Worstall said that Amazon, and its founder and chief executive Jeff Bezos are behaving as a company should: investing in its business, in research, development and innovation, rather than paying its shareholders large profits – on which tax would be due.
