The Financial Conduct Authority (FCA) has published its approach to implementing the revised Payment Services Directive (PSD2), which aims to make payments safer and more secure, affecting all institutes which provide payment-related services from 13 January 2018
PSD2 is an EU Directive which sets requirements for organisations that provide payment services, and will affect banks and building societies, payment institutions, e-money institutions and their customers.
The revised directive, which comes into force from 13 January 2018, aims to improve customer protection, make payments safer and more secure, and reduce the costs of payment services.
Christopher Woolard, executive director of strategy and competition at the FCA, said: ‘Competition in retail banking and payments is vital to UK consumers and the wider economy. PSD2 builds on this by giving consumers 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.’
Some organisations will need to be registered for the first time as a result of PSD2. Existing payment institutions and e-money institutions will need to be re-registered with applications opening on 13 October 2017.
PSD2 has been implemented in the UK through the Payment Services Regulations 2017, which were laid before Parliament on 19 July 2017. The FCA has previously consulted on new or amended rules and guidance intended to implement the PSD2. This includes a revised Approach Document which set out the FCA’s approach to applying the Payment Services Regulations 2017 and the E-Money Regulations 2011 (EMRs) in a single document.
Implementation of the revised Payment Services Directive (PSD2): Approach Document and final Handbook changes is available here.