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A guide to understanding PSD3
Discover what PSD3 is, the differences between PSD2 and PSD3, and its impact on payments.
When the Payment Services Directive 2 (PSD2) was first approved in 2015, it aimed to create a more open, competitive, and secure payments landscape.
Since then, the market has evolved and so, an update to PSD2 was proposed.
The aim? To bring payments and the wider financial sector further into the digital age.
These proposals will amend and modernise PSD2 (which will become PSD3), and introduce a Payments Services Regulation (PSR).
Key changes and highlights:
PSD3 is an updated version of PSD2 and provides rules on the efficiency and security of digital payments and financial services in the EU.
PSD3 sets out more extensive Strong Customer Authentication (SCA) regulations and stricter rules on access to payment systems and account information.
PSD3 aims to protect consumers’ rights and personal information while improving competition in the payments industry.
The new proposals also include a new Payment Services Regulation (PSR) to improve consumer protection. This will be directly applicable to EU Member States.
There is currently no clear timeline for implementing PSD3 and PSR. The member states usually receive an 18-month transition period, suggesting that PSD3 and PSR could take effect around 2026.