Where are the innovations of PSD2? With the exception of British banks, European banks have so far not lived up to expectations raised in 2018. This article examines the reasons and explains which opportunities still lie.
Three years after the introduction of PSD2, which required banks to share customer payment data with Third Party Providers, the high expectations have not yet been met. All banks have realised the necessary technical infrastructure, and new players and new applications have emerged, mainly aimed at information and aggregation. The number of innovations where payments can be initiated on behalf of the customer is still very limited. The main cause of the lagging innovation is the lack of coordination and standardisation. In addition, research shows that European consumers are still reluctant to share their payment details with third parties. The United Kingdom is an exception, where the nine major banks have worked together from the outset to make PSD2, AKA Open Banking, a success, which has resulted in a number of innovative applications. There are also opportunities for European banks to create more value with the help of the new possibilities. For this, PSD2 must definitely come out of the sphere of compliance and be seen as a commercial opportunity to conquer market share, certainly in combination with Instant Payments.