PSD2 gives banks chance to evolve

Author: Olly Jackson | Published: 26 Jan 2018

The revised Payment Services Directive (PSD2) is likely to disrupt traditional banks but could potentially provide opportunities which have been largely overlooked so far.

Member states were required to implement the directive, which looks to increase competition in the banking sector and provide greater consumer protection by January 13 2018. It has been hailed as a major boost for fintech companies, which can now offer the same services as high street banks and have access to banks’ customer data. However, these claims could have been overstated.

The directive has established two new payment services: account information service providers (AISPs), which give providers access to customer account information, and payment initiation service providers (PISPs), which allow third-parties to login to an account and initiate a payment on behalf of the customer. Much of the provisions update the existing conduct rules though their scope has increased. Banks are also obliged to...