PSD2 Directive and its implication on marketplaces
The PSD Directive (Payment Services Directive), officially known as the Directive (EU) 2015/2366 on payment services, is a European regulation aimed at enhancing the security of electronic and online payments within the EU.
The Payment Services Directive 2, commonly referred to as PSD2, applies to entities involved in the realm of electronic payment services.
Categories of entities to which PSD2 applies
The primary categories of entities to which PSD2 applies include:
- Payment Service Providers (PSPs): These encompass banks, financial institutions, fintech companies, and any entity offering payment services to their customers. This includes intermediaries connecting customers to banks and providing payment services through their platforms.
- Users of Payment Services: Both consumers and businesses utilizing payment services such as credit cards, bank transfers, and other payment methods.
- Third-Party Payment Service Providers (TPSPs): These are entities that are not banks or financial institutions but offer payment-related services. Examples of TPSPs include companies providing account aggregation services, payment initiation services, and other payment-related services.
The primary objective of PSD2 is to enhance the security of online payment transactions, promote innovation and competition in the payment services sector, and improve consumer protection. To achieve these goals, PSD2 introduces specific requirements for Strong Customer Authentication (SCA), rules for account access by TPSPs, and other provisions related to payment services.
Entities falling within the description of payment service providers must obtain the necessary authorization from the Bank of Spain to continue operating in the market, as they are subject to supervision and must meet certain minimum requirements.
PSD2 and Marketplaces
In this regard, the PSD2 Directive outlines various scenarios that are exempt from its scope, including point b) of Article 3: Payment transactions through a commercial agent authorized by the payment service user, which currently corresponds to marketplaces.
However, here lies the challenge for marketplaces: the Directive’s recital 11 states the following: “...the exemption applies when the agent acts solely on behalf of the payer or solely on behalf of the payee, irrespective of whether the customer’s funds are held by the agent. If the agent acts on behalf of both the payer and the payee (as is the case with certain e-commerce platforms), the exemption should only apply if the customer’s funds are not held by the agent at any time.”
Therefore, in cases where the commercial agent (marketplace) holds the funds of users and customers and acts as an intermediary in payments, the PSD2 Directive does apply. This marks a significant change from the predecessor regulation, PSD1, as PSD2 has eliminated this crucial exemption that previously allowed marketplaces to operate without a payment services provider license.
In a marketplace scenario, where a platform acts as an intermediary between buyers and sellers, without directly processing transactions, PSD2 presents a significant challenge. Platforms can no longer receive funds from buyers and transfer them to sellers without obtaining a payment processing license. This entails more stringent regulation and the need to comply with the regulatory requirements specified in the Directive.
With these changes, regulators aim to ensure that online transactions comply with consumer protection standards, prevent money laundering, and ensure fair competition throughout the European Union, providing all necessary assurances to both users and providers.
The most significant change lies in the fact that if platforms act on behalf of both buyers and sellers, they can only avoid the obligation to obtain a payment services provider license if the funds from transactions are not held in their accounts or under their direct control. Instead, they have the option to use licensed payment service providers to handle payment transactions.
Letslaw es una firma de abogados internacionales especializada en el derecho de los negocios.