FCA finalises PSD2 requirements
Written by Chris Lemmon
The Financial Conduct Authority (FCA) has published its approach to implementing the revised Payment Services Directive (PSD2).
PSD2 is an EU Directive which sets requirements for firms that provide payment services, and will affect banks and building societies, payment institutions, e-money institutions and their customers. As well as promoting innovation, PSD2 aims to improve consumer protection, make payments safer and more secure, and drive down the costs of payment services. The new regime will be in force from 13 January 2018.
The FCA has announced that more services will be brought under its PSD2 scope, including account aggregation services which aim to help consumers manage their finances by collating their bank account data together in one place.
PSD2 requires existing payment institutions and e-money institutions to be re-authorised or re-registered. Firms should consider whether they now need to seek authorisation or registration because of changes to the scope of regulation made by PSD2. This includes businesses providing account aggregation or online payment initiation services. Applications will open on 13th October.
Christopher Wollard, executive director of strategy and competition at the FCA, commented: “Competition in retail banking and payments is vital to UK consumers and the wider economy. PSD2 builds on this by giving customers more choice around how they manage their payments and bank accounts. It also brings in some important protections for consumers and seeks to increase the security of payments.
“Firms should make sure they know what’s required of them to be ready for the new regime. We will continue to monitor closely whether competition in the market improves in the interests of consumers.”