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ARTICLE · 23 JUNE 2026

PSD3 And PSR: What Every Payment Institution And EMI Needs To Know Now!

MK Fintech Partners
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The Payment Services Directive 3 (PSD3) and Payment Services Regulation (PSR) introduce fundamental changes to the EU payments landscape, including the elimination of the standalone EMI licence, mandatory Verification of Payee requirements, and a significant shift in fraud liability. With a 27-month transitional window, payment institutions and electronic money institutions must begin preparing now to meet the new unified framework's stringent requirements.

MaltaFinance and Banking
Kane Sammut Henwood
Kane Sammut Henwood
Justine Scerri Herrera
Justine Scerri Herrera
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  1. The End of the Dual Licence: One Framework for All Non-Bank PSPs

Perhaps the most structurally significant change is the abolition of the standalone EMI licence. Under the current regime, PIs and EMIs operate under separate directives (PSD2 and EMD2), each with its own capital requirements, safeguarding rules, and authorisation criteria.

PSD3 eliminates this split. The issuance of electronic money is reclassified as a payment service (Annex I, Point 8), meaning every non-bank PSP whether it provides payment services, issues e-money, or does both must hold a single Payment Institution authorisation.

This resolves long-standing ambiguity around the boundary between payment services and e-money services, an area where some undertakings exploited grey zones to obtain a PI licence while effectively conducting e-money activities.

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