The Revised Payment Services Directive (PSD2) is a landmark regulation that reshapes Europe’s digital payment landscape. It introduces Strong Customer Authentication (SCA), enabling more secure online transactions and reducing fraud. PSD2 also mandates that banks open up their payment data to third-party providers (TPPs), fostering innovation and competition in the financial sector.
By enforcing Open Banking, PSD2 allows customers to grant third-party apps access to their banking information, encouraging the development of new fintech solutions. This regulation has led to the emergence of API-driven financial services, enabling seamless integration between banks, fintech companies, and payment service providers.
- Enforces Strong Customer Authentication (SCA).
- Opens up banking data to Third-Party Providers (TPPs) via APIs.
- Enhances fraud prevention for online payments.
