By Mark Kleinman, City Editor
The UK's big high street banks could relinquish ownership of the company which administers Britain's payments infrastructure amid mounting political pressure for them to cede control of the business.
Sky News has learnt that Andrea Leadsom, the City Minister, and Mark Garnier, an influential member of the Treasury Select Committee, recently met bank executives and the boss of Vocalink to discuss the company's future ahead of the launch of the independent payments industry regulator next spring.
People close to the major retail lenders said that Vocalink's board had appointed Lazard, the investment bank, to advise on raising capital to expand the payments company's activities.
Options would include selling a stake to a private equity firm, raising new debt, tapping existing shareholders for new funds, or - less likely - an initial public offering on the London Stock Exchange.
Recent corporate activity in the sector, including the takeover of Nets in Scandinavia, had fired interest in a new round of consolidation, with Vocalink playing a potentially important role.
In recent weeks, the discussions have evolved, with politicians understood to include Ms Leadsom expressing a view that independent ownership of Vocalink would be desirable.
They are said to think that the current system is open to conflicts of interest at a time when the Government is pressing for new challenger banks to have equal access to payments infrastructure.
Vocalink is owned by 17 banks, with the size of their shareholdings dependent upon their market size, ranging from Lloyds Banking Group's 25% to Bristol & West Building Society, which owns 0.69%.
The six biggest lenders, including Nationwide, the UK's largest building society, also have representatives on the Vocalink board.
The company last year processed more than 10 billion transactions with a value of £5tn, and provides the platform for BACS and the Current Account Switch Service as well as the Faster Payments Service and the LINK ATM network.
Its most prominent consumer-facing launch was that of Zapp, a smartphone app, which enables bank customers to pay for goods and services in-store and online using mobile devices.
Vocalink's board, which is chaired by Sir John Gieve, the former deputy governor of the Bank of England, wants to raise capital in order to expand more quickly.
The company has significant interests in Singapore and Sweden and is setting its sights on other international growth opportunities; and it wants to accelerate the roll-out of Zapp and a number of other consumer-facing projects on which it is working.
"There are lots of competing views," said a source at one of the banks which is among Vocalink's shareholders.
The Bank of England is understood to be comfortable with the status quo, believing that it contributes to financial stability objectives, with some banks fiercely opposed to giving up control of the company.
A source close to the Treasury said that the new Payment Systems Regulator would have a remit to consider "potential structural barriers to competition in the payments sector such as ownership of the payments infrastructure" once it is operational next year.
"The PSR will have a range of powers of direction over payment infrastructure providers, and will have competition powers that mean it could make a referral to the Competition and Markets Authority to undertake a full market investigation," the source said.
The Treasury, Vocalink and Lazard all declined to comment on Monday.
