1. Key dates for PSD2 and implications to EU/UK payment processors
2007
2013
2014
2015
2016
2017
2018
2019
Payment Service Directive (PSD)
Established Single Euro Payments Area – Legal, Competition, Innovation, Simplify
Payment Service Directive 2 (PSD2)
Standardizing, consumer protection, online, innovation, competition, pricing
European Commission
Proposal
European Parliament & European Council
Published
Payment Institutions
Enforce
Local Legislation Deadline
Regulatory Technical Standards (RTD)
Strong Customer Authentication and Secure Communication
European Banking Authority
Draft
Transpose
Impact category
Significant Changes
Detailed implications
Competition
New players access the customers' payment accounts; XS2A - Access to Customer Accounts
Increased competition due to commoditization of customer data
Reduced advantage derived from customer data ownership
Direct Merchant to Bank connection
No intermediaries required (Use of APIs)
Investment
Strong Customer Authentication (SCA)
Increased cost of processing and required infrastructure investment
Additional technology solutions to meet the 2 of 3 verification forms
One leg out - Broader geographical reach
EU/UK companies will need to comply with any international payment processing
Global competitors involved in European payments will require compliance
Revenue / Cost
Ban on surcharging - Interchange Fee Regulation
Cap on interchange fee revenue
Consumer protection cap was reduced to $50 from $150 and expanded to transactions outside the EU
Increased cost of business and expected consumer loss expenses
Unconditional right of refund for direct debits
Increased service expenses
Source: This information might evolve in relation to the EBA's and Commission's own calendars