Payment Services Directive

Since the 1st of July, the European operators face major issue with the use of USDC, which is one of the stable coins.

and there is overlap of the regulation of EMTZ money tokens and which comes from MICA with the PSD2 which is a payment service directive 2 in relation to stable coins so if you are going to use an approved stable coin in European Union You also need to comply with certain areas of the other regulation, not only MICA, by having your CASP license.

So you need to create synergies with other institutions, so-called EMIs, in order to be able to handle this.

So that's a place in the regulation which actually at this moment brings all the CASP entities in a very difficult position because they need to go and find partnerships.

Credit decisions anchored in supply chain data, purchase orders from exporters, satellite verification of planted area, payment history within agricultural cooperatives, are replacing the branch visit and the guarantor requirement enterprise operations open banking as the erp's new backbone perhaps the least discussed but most structurally significant transformation is happening inside enterprises themselves Open banking is not only about consumer financial inclusion, it is about corporate treasury, accounts payable automation, supplier financing, and real-time cash visibility.

In the European Union, the PSD2 directive has forced open the corporate banking stack, and the results have been rapid.

Companies like Trulayer in the UK and Tink in Sweden, now part of Visa, have built open banking infrastructure layers that allow enterprises to move money, verify accounts, and initiate payments without touching legacy banking interfaces.

Corporate treasury teams that once spent days reconciling accounts across multiple banking relationships can now access consolidated, real-time views through a single API connection.

Maybe the first question, a very general one.

We're now 10 years past PSD2 and probably also almost 10 years that we have been discussing PSD2 and open banking.

Looking at the topic today, do you consider it a success? Well, of course,

that depends on the definition.

But if you look back and I would say if you have an overall assessment of how it started, what happened and where we are today, my assessment would be that PSD2 and also the first PSD2, because PSD2 built upon the first PSD, of course, it succeeded in opening, let's say, the payments market.

opening up the payments market, but it did not by itself create, let's say, a functioning European open banking, pan-European open banking ecosystem.

It did change, of course, the structure and the mindset of the industry.

I think it was a success, but not necessarily the success that the Commission intended when they drafted it.

Um, it's quite a, uh, quite a thing, especially because you've been working on open banking much longer than that, which gives you a very good view on where we stand with open banking.

I think we're now 10 years after PSD2, and looking at open banking today, do you consider it a success or is it below expectations or the initial expectations that we had 10 years ago?

Thank, thank you, Rick.

Uh, thanks for, uh, having me.

Uh, so to me, open banking today is really that entire view.

Banks open up towards other parties, but as well other partners integrate into the banking, uh, context in order to be able, at our side as well, to provide the right services towards our customers.

So to come back on, on your question, there, I think PSD2 was definitely a game changer.

Uh, it, uh, made sure we could, uh, build our infrastructure.

Exactly.

And that operates under PSD2 regulations, the European directive that mandates strong customer authentication.

The human retains absolute cryptographic control of the funds.

So it essentially turns a clunky, multi-page, six-step checkout process into a two-step biometric approval.

Got it.

Now, there are already legal frameworks that govern electronic payments across the EU, and for the listeners, if these acronyms are familiar, so PSD2 and EMD2, the Payment Services Directive and the Electronic Money Directive.

Now, let's say for a crypto payments platform, for a stable coin issuer or a company offering like off-ramping of stable coins, on-ramping, off-ramping.

Now, there's a tension between MiCA and these existing directive.

Yeah, de- definitely.

So there was, just to give a bit more context, a no action letter by the European Banking Authority a couple, a couple of months back, I think it was earlier this year, which basically said that electronic money tokens, so your USDC as an example, are also e-money under EMD2, which is the Electronic Money Directive within the EU.

And electronic money is deemed to be funds, which goes then under PSD2.

So at any point in time where you're applying for a crypto asset service provider at this point in time within the EU, if I'm applying for a crypto asset service provider and I'm enabling the custody, the trading, et cetera, of electronic money tokens, technically then I'm also triggering PSD2.

I want to actually find some interesting parallels to everything that we've been discussing here with regards to open banking as well.

Remember when PSD2 came along and all the banks were kicking and screaming that, oh, no, we don't want to do this.

It's horrible.

And why would we open up our APIs and all these services? And they had to do it.

So this understanding that APIs are going to happen was very important for us to choose our strategy.

And now we're really working on moving beyond open banking into what we call embedded finance or embedded banking, where especially now with the future of agentic AI flows, we need to find a way, how do the agents work with our banking services? And that becomes part of our open banking journey as well.

Final point on that, one of the reasons why the Nordics was able to move forward quickly with the open banking and especially beyond PSD2 is because we had and still have a very strong digital identity or EID infrastructure in the Nordics.

In many countries where you just have the API, but you don't have an EID infrastructure, that initiation becomes more complicated because there's no standardization on that level.

That's already part of the answer, I think, of question one.

10 years after PSD2, because that's how long we've been discussing this directive.

Looking at Open Banking today, has it been a success according to you?

A good question also, but that's the key question.

But I was thinking about this question because I could prepare this a bit.

I think the main thing is the paradigm shift, mainly for incumbents.

That really is because PSD2 forced banks to open up and incumbents and financial institutions to open up.

their services but actually customer data that's also really important to stress it's in principle it's not the data of the bank of

Então eles precisam obedecer as leis bancárias da União Europeia pesadíssimas.

Mais do que isso, eles operam sobre o escopo da diretiva PSD2 europeia.

Isso significa que pro dinheiro fluir, tem um nível de compliance, de avaliação de conformidade, que é implacável.

Nossa, me dá um exemplo.