Barclays partners with Brookfield to transform payment acceptance business

By Gloria Methri

Barclays has entered into a long-term strategic partnership with Brookfield Asset Management Ltd. to accelerate the growth and transformation of its payment acceptance division, previously known as its merchant acquiring business.

Under the agreement, the two firms will work together to establish the business as a standalone entity, leveraging Barclays’ strong client network and deep experience in the UK payments landscape, alongside Brookfield’s global private equity expertise. The aim is to position the business for sustainable long-term growth in a rapidly evolving payments environment.

The payments business plays a critical role in the UK’s financial ecosystem, processing billions of pounds in transactions annually for SMEs and multinational corporates. The partnership aims to expand the business’s service offerings and enhance the customer experience, delivering improved financial performance over time.

Barclays has committed approximately £400 million to the business, with most of the investment expected to be deployed within the first three years. Brookfield will contribute transformation expertise and will receive a performance-based financial incentive, ensuring aligned interests between the two parties.

From year three of the partnership through to year seven, Brookfield will have the option to acquire up to 70% of the business at market value, subject to certain pre-agreed conditions. These include Barclays fully recovering its investment in transformation. Upon completion of this transaction, Brookfield’s initial incentive will convert into an additional 10% stake, resulting in Brookfield’s ownership reaching up to 80%. Barclays intends to retain a 20% stake.

Importantly, the business will continue to operate under the “Barclaycard Payments” brand and will remain Barclays’ exclusive provider of payment acceptance services for a minimum of ten years. The strategic investment and partnership are not expected to affect Barclays’ current financial guidance or performance targets materially.

Matt Hammerstein, CEO, Barclays UK Corporate Bank, said, “We have a leading position in the UK, but we know that our payments clients are increasingly looking for integrated connectivity, an end-to-end service and tailored technological solutions from their payments providers. Our partnership with Brookfield recognises the opportunity within our business to go beyond the foundations we have built to date.”

Sir Ron Kalifa, Vice Chair and Head of Financial Infrastructure, Brookfield, said, “Payments systems need to adopt a digital-first and data-led approach to provide world-class solutions to clients. We are excited to draw on our deep global payments expertise to partner with Barclays and together deliver the operational transformation required to create the market leader, well-positioned to drive the growth of the UK’s digital economy with innovative and integrated payment solutions.”

This transaction marks the first investment by Brookfield Financial Infrastructure Partners (BFIP), a strategy within Brookfield’s private equity arm focused on digital financial infrastructure. Brookfield has previously executed over $5 billion in similar deals, including its partnership with First Abu Dhabi Bank on the Magnati payments carve-out and its acquisition of Network International, a major merchant acquirer in the Middle East.