EU regulators to update payments services

The updated rules aim to stimulate competition, to provide payment services and foster innovative payment methods, especially for online payment services. They still need to be endorsed by Parliament as a whole and the Council. MEP Antonio Tajani (EPP, IT) stated that the EU payment services market is fragmented and expensive, costing EUR 130 billion, or over 1% of EU GDP, a year, Moreover, he said that the new regulatory framework will mitigate costs, enhance the security of payments and improve the emergence of new players and new mobile and internet payment methods.

A payer using an online account would have the right to use payment software or devices provided by an authorised third party and to have his payments executed on his behalf by this provider. A bank servicing such an account could deny this third party access to a payers payment account only for objectively justified and evidenced security reasons which have been reported to the supervisory authorities. This safeguard should preclude any possibility of banks “blocking” the market for new payment services.

Payment service suppliers would have to adopt technologies that ensure safe authentication of the user and reduce the risk of fraud. They would have to ensure that a users personal data are transmitted through the safe channels and that they are shared only with the user’s consent and to the minimum possible extent. The agreed text, which also updates the rules in a wide range of other areas, such as refund rights, payment service charges and surcharges, will be further discussed in technical three-way talks between MEPs, the Council of Ministers and the European Commission. As soon as a final agreement is reached, Parliament will be put it to a plenary vote. The outcome will also need to be endorsed by EU member states.