Directive (EU) 2015/2366 Revised Payment Service Directive (PSD2)

Revised rules for payment services in the EU SUMMARY OF: Directive (EU) 2015/2366 on EU-wide payment services WHAT IS THE AIM OF THE DIRECTIVE? Directive (EU) 2015/2366 (known as the revised payment service directive or PSD2) provides the legal foundation for the further development of a better integrated internal market for electronic payments within the European Union (EU). - It establishes comprehensive rules for payment services*, with the goal of ensuring harmonised rules for the provision of payment services in the EU and a high level of consumer protection. - It seeks to open up payment markets to new entrants, leading to more competition, greater choice and better prices for consumers. - It provides the necessary legal basis for the single euro payments area. - It repealed Directive 2007/64/EC from 13 January 2018. KEY POINTS The directive sets out rules concerning: - a licensing regime for payment institutions, including those offering account information and payment initiation services (‘open banking’); - the transparency of conditions and information requirements for payment services, including charges; - the rights and obligations of users and providers of payment services; - strict security requirements for electronic payments and the protection of consumers’ financial data, in order to guarantee safe authentication and reduce the risk of fraud. The directive is complemented by Regulation (EU) 2015/751, which caps the interchange fees charged between banks for card-based transactions. This is expected to drive down the costs for businesses in accepting consumer debit and credit cards.