The European Payment Services Directive (PSD)
has been described by the European Commission and European Central
Bank as providing the legal foundation to make the Single Euro
Payments Area (SEPA) possible. The PSD is particularly crucial to
the security of cross-border credit transfer, direct debit and card
payments.
has been described by the European Commission and European Central
Bank as providing the legal foundation to make the Single Euro
Payments Area (SEPA) possible. The PSD is particularly crucial to
the security of cross-border credit transfer, direct debit and card
payments.
Adopted by the European Parliament in March
2007 the PSD comes into force on 1 November 2009 – a tight deadline
many money transfer service providers are paying scant heed to
reveals a survey undertaken by the International Association of
Money Transfer Networks (IAMTN). The IAMTN survey’s findings are
similar to those of a survey of banks undertaken by payments
industry consultancy PSE Consulting.
2007 the PSD comes into force on 1 November 2009 – a tight deadline
many money transfer service providers are paying scant heed to
reveals a survey undertaken by the International Association of
Money Transfer Networks (IAMTN). The IAMTN survey’s findings are
similar to those of a survey of banks undertaken by payments
industry consultancy PSE Consulting.
“Our findings are worrying for the money
service sector,” the IAMTN’s CEO Olga Maitland told delegates to a
PSD conference organised by business law firm Sidley Austin.
service sector,” the IAMTN’s CEO Olga Maitland told delegates to a
PSD conference organised by business law firm Sidley Austin.
“Most companies we found have chosen to ignore
the changes or make any preparation at all, despite being only 16
months away from the deadline. Indeed we found, as indeed did PSE
in their survey, that the vast majority of businesses and banks are
light years away from preparedness. This will cause massive last
minute problems for them.”
the changes or make any preparation at all, despite being only 16
months away from the deadline. Indeed we found, as indeed did PSE
in their survey, that the vast majority of businesses and banks are
light years away from preparedness. This will cause massive last
minute problems for them.”
Maitland continued that the PSD will provide
money service companies with “a great opportunity” to compete on an
equal footing with banks.
money service companies with “a great opportunity” to compete on an
equal footing with banks.
She was referring to a provision in the PSD
that will introduce a new lightly regulated licensed entity called
a Payments Institution. This will enable non-bank money service
businesses to join bankers’ payment schemes and associations
throughout the EU.
that will introduce a new lightly regulated licensed entity called
a Payments Institution. This will enable non-bank money service
businesses to join bankers’ payment schemes and associations
throughout the EU.
Given this benefit Maitland stressed: “It is
interesting to note how little attention has been paid to changes
which will undoubtedly change the way they [money service
companies] operate.”
interesting to note how little attention has been paid to changes
which will undoubtedly change the way they [money service
companies] operate.”
In its survey the IAMTN found that only 11
percent of respondents had made a PSD impact assessment and of
these only 7 percent had agreed a budget for implementation.
Despite this 61 percent of respondents believe they will derive a
revenue benefit from the PSD. By comparison nearly 60 percent of
banks surveyed by PSE Consulting do not believe that the PSD holds
any benefits for them.
percent of respondents had made a PSD impact assessment and of
these only 7 percent had agreed a budget for implementation.
Despite this 61 percent of respondents believe they will derive a
revenue benefit from the PSD. By comparison nearly 60 percent of
banks surveyed by PSE Consulting do not believe that the PSD holds
any benefits for them.
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