What is PSD2? The rules behind open banking and secure payments
By SendPay Business · · 2 min read
PSD2 is the EU's second Payment Services Directive, which applied from January 2018. It opened up banking to new payment companies and made online payments more secure. In the UK its rules are carried through the Payment Services Regulations 2017, overseen by the FCA.
What it changed
- Open banking: with the customer's permission, licensed companies can see account data or start payments from a bank account.
- Strong customer authentication: many online payments need two separate checks, such as a phone and a PIN.
- Clearer rules for payment companies on licences, refunds and fees.
Why it matters for new platforms
PSD2 is a big reason so many new payment apps exist. It set out how non-bank payment companies can be authorised and how they must protect their customers.
What it means for you
If you launch a platform that moves money, rules like these decide which licences apply and how your customers log in and approve payments.
Where SendPay fits
SendPay platforms are powered by licensed partners. SendPay tells you in writing which licences apply to your platform before you pay.
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This guide is general information, not legal or financial advice. SendPay Business is a technology company, not a bank, and does not take deposits; regulated services on the platforms are provided by licensed partners. PayPal, Patreon and Substack are named as reference points only and are not affiliated with SendPay Business.