The Revised Payment Services Directive (PSD2) is a mandate of the European Union (EU) that enables business and consumer banking customers to use third-party providers to manage financial transactions. It requires banks to provide third-parties, including Payment Initiation Service Providers (PISPs) and Account Information Service Providers(AISPs) access to their customers’ accounts through open APIs.
Third-party providers will have access to customer account information and can initiate payment processes on a customer’s behalf. This expands partnership opportunities for banks by combining services with FinTech application provider companies to create new value chains and a new experience for customers
PSD2 offers an opportunity for financial institutions to step up their digitalization efforts and modernize their IT infrastructure. Financial organizations seizing this opportunity can create a strategic business advantages and differentiate themselves in the market.
PSD2 fundamentally changes the retail banking environment when any of the participants (bank, customer, merchant, or third party) resides in Europe. It encourages the role of third party providers in the retail banking chain, leading to innovation in the banking sector and unlocking valuable customer data. Businesses and consumers alike can choose to bypass credit-cards entirely and pay merchants securely and efficiently from their bank accounts, with the attendant benefits of zero commissions and greater efficiency.
With the deadline to comply with PSD2 fast approaching, banks must fight against time to get their IT systems ready. Banks need API Management, and Enterprise Integration for interaction with PISPs, AISPs and other banks.
Fiorano PSD2, an end-to-end PSD2 solution, built on the industry's leading banking Integration and API Management infrastructure, provides a comprehensive solution for banks to become PSD2 compliant. Fiorano PSD2 masks complex technical details to provide a seamless solution that integrates with all leading corebanking platforms and can be implemented in weeks.