PSD 2Proposal for a revised Directive on payment services

State of play

Payment Systems Market Expert Group

11 April 2014

Silvia Kersemakers, 11 April 2014

Where are we in the process of adoption?

European Parliament

Council:

Council

Responsible committee : ECON - rapporteur : Diogo Feio (EPP-PT) - ECON report adopted on 20 February 2014 - JURI opinion adopted on 17 December 2013- EP Plenary vote on ECON report on 3 April 2014

Discussions started under Greek Presidency

1st Council Working Party (CWP): 26 Feb (both PSD2 and IF-Reg) 2nd CWP: 25 March (only PSD2)3rd CWP: 28 April (only PSD2)

EP position – main elements

14/05/23

• EP broadly endorses the key features of COM proposal:

• Extension of scope(of Title III) to one leg transactions and all currencies

• Inclusion of third party payment services providers• Enhancement of secure payments • Greater involvement of EBA

Some amendments go further from a consumer perspective

EP position in more detail (1)

Positive scope• EP supports COM proposal that extension of scope to

one leg transactions only concerns Title III provisions (for now), but also

• proposes to introduce review clause allowing to consider further extension to other provisions of PSD2 at a later stage.

14/05/23

EP position in more detail (2)

Negative scope• EP largely supports the proposed narrowing of negative

scope, and takes it in some cases even one step further:• Lowering thresholds for low value payments through telecom operators -

from EUR 50 to EUR 20 per transaction and from EUR 200 to EUR 100 per billing month

• Specific exemption for donations to authorised charities• Specific exemption for limited networks in context of social benefits or

taxes

14/05/23

EP position in more detail (3)TPPs• EP supports inclusion of TPPs in scope and adds provisions

aiming to ensure the right legal and technical framework in which these new players can operate:• Development of common and secure open standards of

communication by EBA for the authentication of TPPs vis-à-vis the account holding bank (ASPSP) and for the communication between the TPP and the bank on availability of funds

• Communication on availability of funds should consist in simple "Yes" or "No"

• No contract between TPP and AS PSP to be required (Art. 58)• Proof of consent of payer to TPP always in express manner

14/05/23

EP position in more detail (4)

Refund right in case of direct debits (DD)• EP goes further by introducing an unconditional refund

right in case of DD, along the lines of the SEPA Rulebook

• This approach may be problematic in some cases of Fixed Amount DD schemes, such as lotteries.

• Task Force established by SEPA Council to identify problematic areas• Further fine-tuning to be considered

14/05/23

EP position in more detail (5)

SurchargesScope of the prohibition on surcharges further expanded by inclusion of commercial cards under the cap regime of the Interchange fee Regulation.

• However, EP retains option for Member States to ban surcharging all together, including for the use of non-capped cards

• Further negotiations on PSD2 and IF Reg to be closely followed to ensure that in the end a proper balance is struck

14/05/23

EP position in more detail (6)

Access to payment accounts (Article 17(2) PSD2)EP supports COM proposal to better ensure fair access to payment accounts for payment institutions to provide their payment services; EP further clarifies the terms and conditions to guarantee such fair access

14/05/23

EP position in more detail (7)

Roles of the EBAEP expands mandates of EBA to also cover:• development of common standard for interface between TPPs and AS

PSPs• Regulatory Technical standards on the information to be provided in

application for authorisation• guidelines on concept of "gross negligence"• Implementing Technical Standards in context of implementation of

security measures• Guidelines on notification of security incidents, sanctions, complaints

procedure • binding mediation in settling disputes between competent authorities

14/05/23

Council negotiations

•Greek Presidency: in best case adoption of general approach in June •

14/05/23

First two CWP (Feb and March) concentrated on:• Scope (Articles 2 and 3)• Prudential requirements (Articles 5-8, 10-14)• Safeguarding (Article 9)• Use of agents for cross-border activities and issues of supervision and

monitoring (Articles 18 and 26)• Access to payment systems (Article 29)• Refund right (Article 67)

Currently, possible technical solutions for the interaction between TPPs and AS PSPs analysed. Therefore, provisions on TPPs to be discussed at later stage