Payments Blog

What is PSD2?

Recently, many people and organizations in the digital payments industry have been asking questions about PSD2. While some of these questions are inherently basic and exploratory, others are more complex, as they deal with some of the intricacies of this new directive.

Fortunately, Cardinal can answer these questions.

The Payment Services Directive, also known as PSD2, is the revised European Union (EU) directive, enforced to regulate payment services and payment service providers throughout the EU and European Economic Area (EEA). This directive was put in place to encourage payment innovation and enforce data security. PSD2 will accomplish these goals by reducing competitive barriers, mandating new security processes and encouraging standardized technology.

For consumers, this is a massive step in the right direction. Any consumer should rest easy knowing that they will benefit from enhanced security and data protection. Merchants and issuers, on the other hand, will be presented with a new set of challenges.

PSD2 contains multiple articles that will govern payment services. One of the articles includes the requirement for Strong Customer Authentication (SCA) in accordance with Regulatory Technical Standards (RTS) for card-not-present transactions. The mandate hopes to ensure that fraud is drastically reduced and that merchants and issuers in the European Economic Area (EEA) are validating their consumers during all electronic transactions.

There will be a more in-depth discussion surrounding SCA coming soon.

With the Cardinal Authentication Network, Cardinal puts Authentication First.

Posted by CardinalCommerce

Welcome to the CardinalCommerce blog. Cardinal is a global leader in authenticating digital transactions, with One Connection to drive digital commerce. Our goal for this blog is to provide a platform that will inform and educate our Customers and partners on consumer authentication, payments, mobile commerce, solution design and big data.

Topics: PSD2, SCA, Cardinal Authentication Network

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