Tink calls for flexibility on PSD2 deadlines
Written by Hannah McGrath
Open Banking platform Tink has published an open letter calling on the UK’s financial regulators to show greater flexibility around the September deadline for the implementation of Application Programming Interface (API) standards under the second Payment Services Directive (PSD2).
In the letter, Tink’s vice president of product Tomas Prochazka warned of the need for banks to be given extra time to implement API measures to avoid a ‘cliff-edge’ scenario which could leave millions of customers’ access to online or web-based financial services in jeopardy.
The Swedish company called for National Competent Authorities across Europe to recognise the lack of preparedness by guaranteeing flexibility around the PSD2 deadline and fostering greater industry collaboration to solve the problem.
This followed analysis conducted by Tink last month, which found that not a not a single financial institution in Europe has so far met the regulatory requirements outlined by PSD2.
In June, financial institutions in Europe were legally required to give third party providers access to their customer’s data by opening up their APIs. Tink found that two thirds of financial institutions in Europe published their APIs in time for that deadline, but claimed that not a single one currently meets the standards to be compliant.
Prochazka commented: “There is clear and compelling evidence that the technology environment mandated by PSD2 is not ready – and the Open Banking movement is in danger of stalling as a result.
“Ultimately, millions of banking customers across Europe will suffer the consequences. Put simply, if we are forced to migrate to a substandard API environment, many people may find themselves not being able to use the online or mobile-based banking services they have become accustomed to over the past few years.”
He warned that “arduous authentication processes, unattractive interfaces and unreliable service” will result in a significant fall in banking customers engaging with new services.
Prochazka concluded that financial institutions needed “time and guidance” to produce a quality technology environment. “With this deadline now just weeks away, we must acknowledge the reality of the situation – by taking stock and adopting a pragmatic approach, we can achieve more together in the long term.”