In order to adapt the EU payments market to the opportunities available in the Single Market and to support the growth of the EU economy, the European Commission has proposed a new Payment Services Directive (“PSD2”). Its aim is to secure the use of low-cost internet payment services by including new so-called “payment initiation services” within its scope. These are services that operate between the merchant and the purchaser’s bank, allowing for cheap and efficient electronic payments without the use of a credit card. These service providers will now be subject to the same high standards of regulation and supervision as all other payment institutions. At the same time, banks and all other payment service providers will need to step up the security of online transactions by including strong customer authentication for payments. Consumers will be better protected against fraud, possible abuses and payment incidents, and may only be required to face very limited losses in cases of unauthorised card payments.
In their comments, the EEA EFTA States welcome the initiative, but note that the proposed text implies that national legislation must require payment card users to bear all losses on unauthorised transactions incurred through gross negligence on the part of the user. The EEA EFTA States are concerned that this may result in a reduction in the level of consumer protection in Europe, at least in some countries, and they therefore encourage the inclusion in the revised directive of the current option in PSD1 to limit customer liability, in order to maintain the present level of consumer protection.
The EEA EFTA States also note that the proposed directive prohibits the payee from charging the payer for using payment instruments for which interchange fees are regulated under the proposed regulation on interchange fees for card-based payment transactions (COM(2013) 550). They point out that it might serve both consumer interests and effectiveness in the payment service area better, if surcharging is not put under absolute prohibition.
Read the full comments here.
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