The Revised Directive on Payment Services (Directive (EU) 2015/2366 – a.k.a. PSD2) is an EU legislation:
The PSD2 legislation is effective January 13th 2018. On March 13th 2018, the additional milestone for the enforcement of Regulatory Technical Standards (RTS) & Strong Customer Authentication (SCA), was published in the Journal of EU. By September 14th 2019 all banks need to have a developers portal with live APIs.
Acronym | What it means | Additional Information |
---|---|---|
API | Application Programming Interface | A connector, available to TPPs, making it easier to develop a computer program by providing specific functionalities. In PSD2 the following APIs are available - Authentication - Payment Initiation - Payment Status - Account Balance |
AISP | Account Information Service Provider | A TPP, making use of PSD2 APIs only to request information regarding the Account Balance. e.g. to aggregate information across multiple accounts & provide a consolidated view of finances, such as a PFM |
ASPSP | Account Servicing Payment Service Providers | An organization providing and maintaining Payment Accounts for customers. e.g. Banks & Financial Institutions |
PISP | Payment Initiation Service Provider | A TPP, making use of PSD2 APIs only to make a payment. E.g. a Treasury Management System used by a corporate to automate outgoing Payments |
PSD2 | The Revised Directive on Payment Services (Directive (EU) 2015/2366 – a.k.a. PSD2) is an EU legislation | The reason you’re looking at this page! PSD2 creates a major Open Banking paradigm for European Banks & is a template for similar projects across the globe |
PSU | Payment Service Users | The end users of all the functionality put in place by PSD2. They can be either natural or legal persons & interact with TPPs & ASPSPs |
RTS | Regulatory Technical Standards | The Regulatory Technical Standards on strong customer authentication and secure communication under PSD2 provide details & guidelines on the implementation of PSD2 |
SCA | Strong Customer Authentication | The SCA caters to the increased security needs for the new PSD2 environment. It requires two or more of the following independent elements to be used, for an electronic transaction to happen: - Knowledge (something only the user knows, e.g. a PIN) - Possesion (something only the user possesses, e.g. key material) - Inherence (something the user is, e.g. fingerprint, voice recognition) |
TPP | Third Party Payment Service Providers | Payment Institutions, which don’t hold payment accounts for their customers. AISPs & PISPS are specific types of TPPs |
XS2A | Access to Account data | The provisions for third party secure ‘access to account’ under the PSD2 directive. This is the cornerstone needed to enable Open Banking under PSD2 |