Moderating the panel on the upcoming PSD3, PSR, and IP regulations, Daniel Hellmann, director of risk advisory payments at Deloitte, engaged with Simone Del Guerra, head of central institutions & international sales at Nexi Group; Nuno Epifânio, policy officer for retail financial services at the European Commission; Kevin Flood, director of payments ecosystem strategy at FIS; and David Malley, payment industry engagement lead at NatWest.
Before the panel discussion began, Hellmann solicited input from the audience regarding which regulatory theme they viewed as a top priority. Reflecting the conference’s main theme, 79% of respondents identified instant payments as the primary concern.
Building on the poll results, Hellmann first turned to Epifânio, who provided a comprehensive overview of the current regulatory landscape from the European Commission’s perspective. While acknowledging limited new information, Epifânio noted that the Commission is collaborating with the council and cabinet to draft updated proposals for the PSR and PSD3. “We just finished our last meeting with the [European] council and are preparing progress reports on both PSR and PSD3,” he shared.
Del Guerra emphasized the importance of preparing for instant payments, highlighting that they represent a significant market opportunity and are essential for the survival of SMEs. His focus is on developing collaborative solutions and value-added services in this area.
Flood brought attention to the necessity of standardization in the upcoming changes, stating, “We need to standardize across the board, which would enable much more innovation.”
Addressing the topic of standardization, Epifânio explained that while the concept was considered, it was ultimately not included in the PSR proposal. “There is currently no unified standard in the EU; various standards are in use, and there are no preferred APIs available, making it difficult to advocate for one over another. We decided against moving forward in that direction.”
The discussion then shifted to the beneficiaries of the regulatory updates. Malley stated, “The entire regulatory package is designed primarily to benefit consumers through enhanced choice, as well as fintechs and SMEs. Banks must find ways to integrate these changes. PSD2 has opened the door for open banking, generating growing interest from merchants on how to leverage it. However, there needs to be commercial incentives to attract all participants in the ecosystem.”
Regarding implementation, Malley noted the considerable work required with the regulatory package, cautioning that compliance obligations could limit innovation opportunities elsewhere. He highlighted a particular concern about fraud, especially as the UK faces impending APP fraud reimbursement requirements.
Del Guerra remarked on the varying strategic approaches among financial institutions, noting that some players are ill-prepared for an unpredictable environment. “There’s significant focus on infrastructure, but operational preparedness is equally important. While discussions about fraud are prevalent, meeting customer expectations for faster and more seamless payments poses a complex challenge.”
When asked about implementation milestones that financial institutions should consider, Del Guerra outlined several steps: priority compliance, followed by planning and testing, and then focusing on infrastructure, which requires time. He stressed the necessity of customer engagement and developing strategies around the new regulations, particularly regarding instant payments. Each financial institution will have a unique proposition, and collaboration with other players in the payments space is essential.
Flood echoed this sentiment, warning that without collaboration, financial institutions could risk stagnation. With instant payments already widely utilized in the UK, the volume of available data is invaluable. He underscored the urgency of initiating discussions and collaborative efforts.