Prepared by Luca Bettinelli, Fabrizio Cascinelli
On 28 June 2023, the European Commission presented a set of measures, collectively identified as the “Payments Package”, aimed at promoting innovation and competition in the payments industry.
The “package” includes a number of legislative proposals and policy initiatives that seek to improve the payment experience of consumers and businesses, as well as to ensure data protection and security of transactions.
Among the key measures of the “Payments Package” are the Third Payment Services Directive (PSD3 – “Payment Services Directive”), the Payment Services Regulation (PSR – ‘Payment Services Regulation’) as well as the framework for access to financial data (FIDA – ‘Financial Data Access’); the Commission also published on the same day the so-called ‘Single Currency Package’ dedicated to the use of cash and the Digital Euro.
Specifically concerning payment services, the measures proposed by the Commission consist of:
- a new Payment Services Directive (‘PSD3’) to replace the current PSD2, which is intended to further modernize the framework in order to address changes in the payments landscape;
- a new Payment Services Regulation (‘PSR’), aimed at providing a more detailed and coherent legal framework for the payment industry, directly applicable in each Member State.
On a more detailed level, PSD3 contains rules on the granting of licenses and the supervision on payment institutions, while the PSR brings together rules for payment service providers and consumers.
The proposed measures – which represent an evolution and not a revolution of the legal framework – aim to modernize and increase security in the EU payments industry; in detail, they concern:
- combating payment fraud by allowing payment service providers to share information on fraud, raising consumer awareness, strengthening customer authentication rules, extending refund rights to victims of fraud, and requiring a system to verify the correspondence between the IBAN numbers of beneficiaries and the name on the accounts for all transactions;
- improving consumer rights, e.g. by providing for greater transparency in cases of temporary freezing of funds, statements and ATM fees;
- levelling the playing field between banking and non-banking institutions, in particular by facilitating the access of non-bank payment service providers to all EU payment systems, provided appropriate safeguards are in place. The initiative will also contribute to simplifying administrative procedures by bringing together the regimes for the two types of non-bank payment service providers (payment institutions and e-money institutions), which were hitherto contained in different pieces of legislation;
- improving the functioning of the open banking system by removing remaining obstacles to the provision of such services and by increasing customers’ control over their payment data, thus enabling new innovative services to enter the market;
- improving the availability of cash at points of sale and at ATMs, allowing retailers to offer cash services to customers without the need for them to make a purchase, and clarifying the rules for independent ATMs;
The Commission’s legislative proposals need to be discussed and approved jointly by the European Parliament and the Council; once finalized, the expected timeframe for compliance is 18 months for Member States to transpose PSD3 and 18 to 24 months for the implementation of the rules under the PSR.
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