Banks are getting ready to comply with PSD2

2019-06-14

As the extended deadline looms, many Advocate consultants are participating in projects initiated by Financial Institutions to prepare the IT architecture to be able to comply with requirements of the EU’s new Payment Services Directive (PSD2). Advocate consultants are working with several Hungarian banks with providing consulting services in many different roles (Business and System Analyst, Project Manager) in the following fields related to PSD2:

  • Introduction of Strong Customer Authentication methods for card not present transactions.
  • Design and development of SCA methods for electronic payments initiated through online channels (Online and Mobile Banking).
  • Development of integration of the necessary software components and interface in order to provide access for Third Party Providers (TPP) to the mandated functionalities of the bank via Open API.

The introduction of the above mentioned new functionalities not just only require efforts and development for the existing IT architecture, but also new business processes, customer communication methods must be introduced - e.g. informing and educating the cardholders about the SCA-methods for online card payments. In these business process improvements Advocate consultants are also helping Hungarian banks in order to make sure that the organization is fully prepared for the transition to operate within the new PSD2 framework.

As the repository of the registered Third Party Providers - third party fintech firms providing applications for initiating payments or checking account information - grows, many of our partners is optimistic regarding the future usage of the mandated Open API, hoping that innovative third party products readily usable by the banks’ clients can improve customer retention and satisfaction rates.