The amended PSD2 is the legal foundation for a single market for payments in the EU. The goal of the directive is to make cross-border payments as simple, efficient and safe as possible.
The PSD has been expanded with two new services called ‘payment initiation services providers’ (PISPs) and the ‘account integration service providers’ (AISPs). PISPs can initiate payments outside the banking environment. AISPs offer the possibility of combining all banking services in one environment.
The role of banks is changing fundamentally with the input of the PSD2. Data in possession of the bank will have to be shared with other payment institutions. This would generate high demand for security and risk mitigation. Banks are required to establish a technical interface that enables third parties to have access to the accounts. The amended payment services directive would significantly increase the market for payment institutions.
Author: Martijn Berghuijs, director