Banking & Finance

PSD3 and PSR: Towards a revolution in European payment services

DSP3 et PSR : Vers une révolution des services de paiement en Europe

Financial innovation is on the cusp of a major transformation with the imminent revision of the Payment Services Directive (PSD3) and the Payment Services Regulation (PSR). This post-PSD2 modernization drive, initiated by the European Commission, aims to reshape the landscape of financial transactions in Europe.

See also PSD3 and open banking: What to expect from the new European directive

There are multiple objectives: to offer modernized payment services, strengthen consumer protection, stimulate competition, and consolidate the confidence and security of transactions. These changes are taking place against a backdrop of increasing digitalization of finance, requiring an improved regulatory approach adapted to technological developments.

PSD3 introduces significant advances, such as the extension of the regulatory scope to Payments Initiate Services (PIS) and Account Information Services (AIS), guaranteeing greater protection coverage for users.

With the introduction of strong customer authentication (SCA), PSD3 imperatively reinforces security, a major issue in the digital age. It also prioritizes clarity of information and ease of cancellation for consumers, while fostering innovation through more open access to banking data.

At the same time, PSR is working to harmonize payment services rules across the European Union, while implementing a single licensing system that promises to unify and simplify procedures for payment service providers.

The definition of technical standards for payment application programming interfaces (APIs) and the implementation of rigorous monitoring go hand in hand with these harmonization efforts.

Dive deeper: FIDA, GDPR, PSD2, PSD3… banks must speed up the opening up of their information systems

This innovative regulatory framework outlines a future where speed, security and innovation are at the heart of payments in Europe, generating greater competition between players and offering consumers more control.

The deadlines are set: the European Commission’s legislative proposals are expected in June 2023, with a view to adoption by the European institutions during 2024 to 2025. Transposition into the national laws of the Member States will then follow, with a target date of 2026-2027.

This is a pivotal period for policymakers and financial regulators, who will have the essential task of ensuring that these changes are successfully rolled out, for a more integrated and resilient single European payments market.

Axway has been the privileged partner of banks for some 25 years as they’ve opened up their technology stacks. It’s why 60% of the world’s largest banks trust Axway.

With the help of secure, open tools such as Amplify Enterprise Marketplace, financial services can embrace these changes to improve their services, increase customer satisfaction, and stay ahead of the competition.

Discover the art of the possible in 10 open banking use cases.