“There is a revolution coming in online payments and Payment Services Directive 2 (PSD2) is at the heart of this transformation. Europe can no longer ignore the need for common solutions. The new European Banking Authority standards offer a reasonable compromise. They bring strong customer authentication and stimulate the development of e-commerce and provide a sound basis for a safe and open payments ecosystem in Europe.”

“In the area of strong customer authentication and secure communication under the revised Payment Services Directive (PSD2). PSD2 has the explicit objective of facilitating innovation and enhancing competition in payment services, allowing new service providers to access customers’ payments accounts at incumbent banks in a secure and standardised way”

Payments were notably the first banking services to go digital (online and/or mobile) with the verification of the bank account balance being the most frequently used, and opening the door to new phases of digital banking. The digital customer expects payments to be seamless and mobile and wants to be able to buy products and services whenever they want from wherever they are. All processes, infrastructures, systems, rules initially designed for “traditional” paper-based payments are currently being adapted/modified/created to cater for the new nature of payments.

For many years, the European payment industry has offered the most secure payment environment to consumers and merchants alike for two main reasons: i) any new product and service launched is natively conceived in a very secure way and, ii) once these products have been launched on the market, payment providers have adopted internal processes that allows them to prevent or react in a very agile way to any fraud attack.

Payment Services Directive 2 (PSD 2)

The Payment Services Directive 2 (PSD2) aims at reinforcing the overall security framework for payments in Europe and mandates the European Banking Authority to develop standards that are deemed to be based on “effective and risk-based requirements” and “allow for the development of user-friendly, accessible and innovative means of payments”

EU institutions

The EU Directive 2015/2366 on payment services in the internal market (PSD2) was published in the Official Journal on 23 December 2015, repealing Directive 2007/64/EC on payment services in the internal market (PSD1).
The revised Payment Services Directive 2 (PSD2) updates and complements the EU rules put in place by the Payment Services Directive (PSD1, 2007/64/EC). Its main objectives are to:

  • Contribute to a more integrated and efficient European payments market
  • Improve the level playing field for payment service providers (including new players)
  • Make payments safer and more secure
  • Protect consumers

Member States are required to transpose this new Directive into national law at latest two years after the formal adoption of the Council and the EU Parliament, i.e., latest on 13 January 2018.

EBA

1) Consultation on the Guidelines on the conditions to be met to benefit from an exemption from contingency measures under Article 33(6) of Regulation (EU) 2018/389 (RTS on SCA & CSC)

2) Consultation on the extension of the application of the Joint Committee Guidelines on complaints-handling to the new institutions under PSD2 and MCD (EBA/CP/2018/02)

3) Guidelines on the criteria on how to stipulate the minimum monetary amount of the professional indemnity insurance under PSD2

4) Regulatory Technical Standards on strong customer authentication and secure communication under PSD2

5) Guidelines on internet payments security

6) Opinion on the implementation of the RTS on SCA and CSC (EBA-2018-Op-04)

European Central Bank

In 19 December 2013 the ECB launched the Euro Retail Payments Board (ERPB). This entity, which replaces the SEPA Council helps to foster the development of an integrated, innovative and competitive market for retail payments in euro in the European Union

Euro Retail Payments Board

Application Programming. Interface (API) Evaluation Group (EG)

API Evaluation Group: Membership list

EBF Guidance on PSD2

This document offers guidance and is intended to provide high-level assistance to banks in relation to both the interpretation

and practical application of the revised Payment Services Directive (PSD2). The document does not aim to be exhaustive in the list of topics it addresses, but rather focuses on specific issues that have been the subject of discussion within the payment industry and/or relate to frequently asked questions from the market.

EBF videos

What do APIs mean for banking?

What is screen-scraping?

EU cross-border payments & currency conversion

Regulation 924/2009 on cross-border payments equalised, across the EU, fees for cross-border payments in euro within the Union with domestic payments in euro (i.e. payments in euro within the same Member State). Non-euro area Member States were given the option to extend Regulation 2560/2001 and its successor Regulation 924/2009 to their national currencies.

European Institutions /Useful links

European Commission

The objective of the recent European Commission’s “Proposal for a Regulation amending Regulation (EC) No 924/2009 [COM(2018) 163 final]” is to align fees for cross-border intra-EU payments in euro with fees for domestic transactions in the national currency of a Member State. Moreover, the Commission’s proposal aims to establish additional transparency obligations for currency conversion practices in the internal market.

European Parliament

DRAFT REPORT on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EC) No 924/2009 as regards certain charges on cross-border payments in the Union and currency conversion charges

European Council

Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Regulation (EC) No 924/2009 as regards certain charges on cross-border payments in the Union and currency conversion charges

EBF Positions
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EBF response to European Banking Authority’s Discussion Paper on its preliminary observations on selected payment fraud data under the Payment Services Directive

Read more →
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EBF response to CR 03/2021: Application of the Principles for Financial Market Infrastructures to Stablecoin Arrangements

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EBF contribution to the ongoing debate on a Central Bank Digital Euro #3: How does a digital euro fit the payments landscape?

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EBF Response to European Banking Authority’s Consultation on amending RTS on SCA and CSC under PSD2 (EBA/CP/2021/32)

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EBF DIGITAL THURSDAYS 2022

Close Up: Building Pan-European Instant Payments

Thursday, 24 November 2022
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Instant payments were rolled out in Europe in 2017 and have since been steadily taken up by the market. Instant payments have also become an important part of the retail payments strategies of the European Commission and the European Central Bank. Late October, the Commission adopted a legislative proposal that seeks to bring instant payments towards the ‘new normal’. The Digital Thursday Close-Up will focus on discussing this proposal, what it means for the industry and how it will impact the potential for building pan-European solutions based on instant payments.

EBF DIGITAL THURSDAYS 2021

From Payments to CBDCs: Are we rethinking the financial ecosystem?

Thursday, 18 November 2021
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The third Digital Thursday 2021 focused on Central Bank Digital Currencies and payments. The event discussed the phenomenon of CDBC globally and debated on the need for CBDCs for a global financial ecosystem. Experts explored how CBDC issuance would change the role of central banks and the banking system overall, while providing insights on different CBDC projects that are under way.  The event touched on a potential integration of a digital euro into the European payments landscape: how does it fit together with the retail payments strategies of the European Commission and the ECB? And how does it affect the objective to develop ‘homegrown’ pan-European payment solutions and the new instant payments framework in Europe?

EBF DIGITAL THURSDAYS 2020

EU payments at cross-roads: what strategy for the future?

Thursday, 19 November 2020
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The European Commission has adopted its Retail Payments Strategy that will shape the policy landscape for payments in the EU for the years to come. One major push of the Strategy will be that of increased European independence and sovereignty in the area of payments.

At the same time, payments worldwide continues to be a part of financial services that is subject to a high level of innovation, disruption and competition by different market players. This event discussed the main pillars of the EU Strategy and will dive deeper into what is needed for a ‘European payments champion’ to emerge.

For more information
Alexandra Maniati

Alexandra Maniati

Senior Director of Innovation & Cybersecurity
Christophe Bonte

Christophe Bonte

Senior Policy Adviser - Payments & Innovation
Alessandra Chiarini

Alessandra Chiarini

Policy Adviser - Payments and Innovation
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