Open Banking is intended to shake up the payments market by
requiring banks to provide TPPs with customers' transactional
data and access to customer accounts to make payments on their
customers' behalf. But the Open Banking revolution will get off
to a slow start while several regulatory questions remain to be
answered.
The revised Payment Services Directive (PSD II) comes into
effect in January 2018, but firms' compliance and strategic
plans have been hampered by the lack of regulatory clarity,
including the absence of a finalised Regulatory Technical Standards
(RTS) on Strong Customer Authentication (SCA) and Common Secure
Communication (CSC) between banks and Third Party Providers (TPPs).
This will make the development and adoption of new services and
products across the EU slower than expected in 2018, although in
the UK, where the Open Banking APIs will go live at the same time
as PSD II, things should move more quickly.
