News

PSD2 receives green light from EU Council

Tuesday 17 November 2015 13:43 CET | News

On 16 November 2015, the European Union Council has passed the Payments Service Directive 2 (PSD2) in an effort to help develop an EU-wide market for electronic payments.

The directive incorporates and repeals directive 2007/64/EC, which provided the legal basis for the creation of an EU-wide single market for payment services. The revised directive adapts the rules to cater for emerging and innovative payment services, including internet and mobile payments. It sets out to ensure a more secure environment for payments, in particular for those using remote channels.

Since adoption of the original payment services directive in 2007, methods for the initiation of payments in the field of ecommerce have evolved. They usually form a software bridge between the website of the merchant and the online banking platform of the payers bank in order to initiate internet payments on the basis of a credit transfer.

These services are now covered by the directive. They enable the payment initiation service provider (who never holds the users funds) to give an assurance to the payee that the funds necessary for a specific payment transaction are available on the customers account and that the payment has been initiated.

A regulatory regime to cover the activities of account information services is also established. These services provide the payment service user, for example, with aggregated online information on payment accounts held with other payment service providers. This enables the payment service user to have an overview of his/her financial situation at any given moment, within a secure environment.

At the same time, the directive promotes stronger security measures for internet payments and for the use of services provided by new market players. It will ensure strong customer authentication to identify the client for each transaction. The new and strengthened supervisory regime will further increase the security level and consumer protection in this field.

The regulation was adopted at a meeting of the Agriculture and Fisheries Council, without discussion. Member states will have two years to transpose the directive into their national laws and regulations. An agreement on the text was reached with the European Parliament on 5 May 2015. The Parliament consequently adopted its position at first reading on 8 October, 2015.


Free Headlines in your E-mail

Every day we send out a free e-mail with the most important headlines of the last 24 hours.

Subscribe now

Keywords: EU, European Council, PDS2, payments directive, bill, banks, merchants, retailers, VAT, taxes, interchange fee, XS2A
Categories: Payments & Commerce | Online Payments
Countries: World
This article is part of category

Payments & Commerce


Related

Half the worlds population to use digital wallets by 2024

Published 11 Jun 2019 00:03 CET | World
The number of people using digital wallets will increase from 2.3 billion in 2019 to 4 billion, 50% of the world’s population, by 2024, according to Juniper Research....

Mastercard to launch pilot contactless payments solution in Poland

Published 31 Aug 2017 08:29 CET | World
Mastercard has unveiled a pilot project in Poland that aims at making a smartphone the only necessary device for accepting contactless payments....

POSB trials contactless payments in Singaporean schools

Published 25 Oct 2016 11:19 CET | World
POSB, a Singapore-based bank, has been testing a new contactless payment system that enables students to make purchases in their canteens and bookstores....

Microsoft Wallet gains support for two new banks, PNC and US Bank

Published 16 Aug 2016 09:41 CET | World
Microsoft Wallet, the company’s new Windows 10 Mobile app designed for mobile payments and collecting loyalty cards is getting support for two new banks in the US, US Bank and PNC (via Windows Central)....

UL updates Cloud-based Payment Test Tool for Visa

Published 20 Jul 2015 10:46 CET | World
UL, a payments technologies provider, has released a new version of its Visa Cloud-based Functional Test Tool to upgrade the tokenized payments running on a Visa payWave mobile payment application....

Virtual Piggy partners WorldPay

Published 22 Jan 2014 10:12 CET | World
Global provider of payment and risk services WorldPay has entered into an agreement with US-based technology provider Virtual Piggy, to integrate the latter’s youth payments technology, dubbed Oink....