Hogan Lovells PSD3 Impacts Report: Getting ahead of the evolving EU payments regulatory landscape

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Hogan Lovells PSD3 Impacts Report: Getting ahead of the evolving EU payments regulatory landscape

23 October 2024

Whilst the legislative proposals for a Directive on payment services and electronic money services (PSD3) and a Regulation on payment services in the EU (PSR) are wide-ranging and will require payment service providers (PSPs) to make further changes, this latest chapter in the ongoing saga of payments regulation is slightly more “evolution” than the “revolution” of its predecessor, the second Payment Services Directive 2015/2366 (PSD2). However, many of the required changes will be significant and challenging - particularly in terms of the tech and ops projects that would appear to be required. The finalised legislation and implementation timelines are still awaited. In the meantime, we have put together a Report to help affected firms get ahead of the game in pinpointing where the proposed changes are likely to impact their businesses.

What’s in the PSD3 Impacts Report?

Our PSD3 Impacts Report summarises the impact of the PSD3 and PSR legislative proposals thematically, highlighting the areas where the EU trialogue process might shift the dial further before the texts are finalised, and flagging where changes might need to be reflected in PSPs’ businesses.

The proposals would affect different payments market players in different ways, so there’s something for everyone in the Report.

For those in need of a very quick overview, the Report also includes an “at a glance” table mapping the changes, and a synopsis of the legislative process to date and expected timing.

The themes covered in the Report are:

Authorisation/Re-authorisation and changes to the e-money regime;
Transaction monitoring and data sharing;
Scope of application and exemptions;
Access for PSPs to payment systems and services;
TPP access;
TPP dashboard;
Strong Customer Authentication (SCA);
Confirmation of Payee;
Impersonation fraud;
Liability;
Surcharging; and
EBA powers of intervention.

What’s the potential implementation timeline?

The PSD3 legislative process is ongoing, with delays in finalising the text. While originally expected under the Hungarian Presidency, it is now more likely that the Polish Presidency will see the PSD3 legislative process through to completion.

Subject to a number of factors within the legislative process (see our Report for more details), PSD3 might not come into effect until Q1 2027.

Want to know more?

We have extensive experience of advising on regulatory change projects, including the previous significant overhaul of the EU payments regulatory landscape under PSD2.

If you have any questions arising from the Report, please get in touch with one of the listed people or your usual Hogan Lovells contact.

Authored by Eimear O’Brien, Charles Elliott, Lavan Thasarathakumar and Virginia Montgomery.

Contacts

Eimear O'Brien

Partner

location Dublin