While businesses around the world are busy getting ready for
GDPR, another wide-reaching EU regulation crept up and took many
outside the Financial Services industry by surprise in January 2018
– the Payment Services Directive 2 (PSD2).
PSD2 removes the previous easy-to-use exemption for electronic
communications providers. Instead, it introduces a much more
limited exclusion – and if they want to exercise it, they
must provide an annual independent audit opinion relating to it. If
they are unable to use the new exemption, they may need a full
Financial Conduct Authority (FCA) licence as a payment
institution.
Most telcos seem to have concluded that the application and
compliance costs of a full licence outweigh the benefits, as many
have opted for the electronic communications exclusion (ECE) for
now. There is recognition, however, that this may be a holding
position until there is greater clarity around what will be covered
in practice and what the FCA will
