What Is DSP2?
What does PSD2 mean ?
PSD2 is the European Union's Second Payment Services Directive. It was implemented on 13 January 2018 and follows on from PSD1, which created the single payments market in 2007. PSD2 is driving change and innovation in the payments industry. It has been introduced to enhance the security of online payments and to promote competition between payment service providers. It also encourages the use of alternative payment methods, such as mobile payment applications, to improve the shopping experience for consumers. This payment security standard also requires payment service providers (banks, fintechs, e-retailers) to implement strong authentication processes in order to offer optimum security to their users.
How does this directive affect transactions ?
The introduction of this directive means that transactions will take slightly longer, as new steps are required to certify the authenticity of the user. This may involve, for example, the use of a single-use code, authentication by fingerprint or facial recognition.
PSD2 also lays down rules for PSPs on data security, helping to protect users sensitive information such as credit card numbers and banking details.
Will PSD2 make payments more complicated?
At first sight, it is legitimate to think that payments will be more complicated because steps can be added (3D Secure, a single-use code, etc.). However, PSD2 does not change the traditional payment protocol, but rather strengthens the system through more robust authentication processes, stricter security protocols and user procedures.
Does PSD2 increase transaction costs ?
The increase in transaction fees depends on the different payment service providers. Some choose to increase fees to cover the costs of complying with PSD2 requirements. Others decide to maintain their fees in order to remain highly competitive.
It is therefore possible that the implementation of PSD2 will lead to an increase in costs for payment service providers, but this does not automatically mean that there will be an increase in transaction fees for users. It is important to check the terms and conditions of each payment service provider to find out what charges apply.
What are the new payment services?
The transition to PSD2 regulations has also led to the creation of two new service provider statuses:
- PSIC : Account Information Service Providers, which collect and aggregate information on a customer's various bank accounts.
- PSIP : Payment Service Initiators, which initiate transfers from a payment account.What are the potential risks of non-compliance with PSD2?
There are many risks associated with non-compliance with PSD2. Any company that does not comply with the regulations of this law may be subject to high financial penalties. They can also be prosecuted for breaching the regulations, resulting in a bad reputation and financial impact.
E-commerce sites and marketplaces need to be constantly aware of new regulations.
PSD2: How can marketplaces comply with the regulations?
There are various ways of complying with European regulations:
- Obtain authorisation from the ACPR : if you choose to manage your own payments on your online platform, it is essential to obtain authorisation as a payment institution from the Autorité de Contrôle Prudentiel et de Résolution (ACPR).
- Applying for an exemption from authorisation : this is a very rare case, but it is possible to benefit from an exemption from authorisation from the ACPR. This only applies to marketplaces that offer few services or products with limited distribution.
Use a payment service provider (PSP): the PSP provides a payment interface for its users.
Obvy, a complete transaction solution
Always remember that a transaction is not just a payment. The payment is just one stage in the transaction!
Obvy offers an all-in-one solution for platforms selling goods and services online, including e-commerce sites, marketplaces, software publishers, etc.
With Obvy, you benefit from all the most popular services and payment methods for collecting and paying in a highly secure environment.
Obvy offers dozens of turnkey services and functionalities (payment, delivery, security, user and transaction management platform, dispute resolution, promotional campaigns, etc.) that enable you to manage all your transactions from start to finish, from the moment a product is put on sale through to payment and delivery of the goods.
Security and compliance with all current regulations are central to Obvy's concerns. That's why Obvy has set up an anti-fraud system based on 30 checkpoints as well as identity verification systems that are carried out via a personalised page hosted by Obvy.
In this way, you avoid all the complexities associated with managing transactions, and you rely on a global solution capable of guaranteeing a high level of customisation, compatibility with your business, an optimal user experience, and scalability that will enable you to explore new levers for growth.