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ReadersSpeak

What's up with PSD2? rective (PSD) that preceded it were
devised by the European Commis-
've been hearing that the EU's PSD2 will be a major disruptor to financial sion to give consumers greater pro-
services when it goes into effect in 2018. In a recent issue, The Green Sheet tection and build a more competitive,
mentioned a Juniper Research report that identifies it, along with open innovative and secure financial ser-
I API legislation in Europe, as top disruptive developments in financial vices market in the European Union.
services this year and next. I'd like to know more. What does it change, why is Regulators in the region determined
it important and how might it affect payment businesses? that disparate banking systems and
Caris Blevins, Merchant Level Salesperson regulations in each member state
Caris, make banking fragmented, costly
and limited in terms of options of-
The Revised Payment Services Directive (PSD2) and the Payment Services Di- fered to consumers.

One huge change is that PSD2 ob-
ligates banks to provide access to
their customers' accounts through
application programming interfaces,
which will enable those parties to
build financial services on top of the
banks' data and infrastructures. Ju-
niper's Top 10 Disruptive Technologies
in Fintech: 2017 report findings indi-
cated PSD2 could lead to third-party
startups undercutting established
players, but the company noted that
"an opportunity exists for co-oper-
ation between banks and startups;
institutions may leverage their es-
tablished brands in partnership with
agile technology startups, to press
first-mover advantage."

In addition, the PSD2 clarifies issues
pertaining to liability for payments,
mandates full disclosure of payment
charges and calls for tougher rules
pertaining to customer authentica-
tion. Any business serving as a Eu-
ropean Payment Service Provider
will be impacted by these and other
aspects of PSD2. The landscape in
Europe is expected to continue to
evolve as EU member nations finish
incorporating PSD2 rules into their
national laws.

Thank you for your question. We
will monitor this in 2018 to see how
PSD2 affects U.S. payment service
providers doing global business.
Editor
What's on the horizon?

What do you expect the primary
factors affecting payments will be
in 2018? Please email your ideas to
greensheet@greensheet.com.

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