PSD 2: A review of the latest Payment Services Directive

Held on Wednesday, May 4, 2016

With support from K&L Gates


  • Ruth Wandhöfer (global head of regulatory and market strategy, Citi)

  • Jeremy Light (managing director Europe, Africa and Latin America, Accenture Payment Services)

  • Simon Newstead (head of strategic business development, VocaLink)




The original PSD was adopted in 2007, and provided the legal basis for a single EU market in cross-border payments. It has (sort of) worked; it has helped cut costs and speeded up transactions, and it has helped make SEPA a reality.

But the payments space is constantly changing, and what worked eight or nine years ago doesn’t work so well now. Hence PSD 2 – which came into force this January, though Member States have until January 2018 to implement it.

PSD 2 has been described as “the mother of all EU banking regulations”. It imposes new duties on banks that are intended to improve integration in the payments market, encourage new players, make payments safer, protect consumers and (last but not least) cut costs. All good stuff – but not easy. One big issue is the commitment to open banking APIs – which would oblige banks to allow certified access to client data, permitting fast user authentication, fast credit scoring and (it is argued) better deals for customers.

Of course, it is not all plain sailing – and, frankly, the Directive itself is a bit of a nightmare. So, we need a guide – and who better than Citi’s Ruth Wandhöfer, who is global head of the bank’s regulatory and market strategy team. She is also chair of the European banking industry’s Payments Regulatory Expert Group and of the EPC’s Information Security Support Group, and is all-world on SEPA.

It is most unlikely that Ruth will need help, but just in case we have two other distinguished experts in the payments field:

  • Jeremy Light is the managing director of Accenture Payment Services in Europe, Africa and Latin America, where his expertise extends across front, middle and back-office payments functions.
  • Simon Newstead is head of strategic business development for VocaLink, having recently joined from RBS where he was responsible for compliance and controls within the bank’s payments business. He has also served as a member of the Payment Systems Regulator’s Advisory Panel and of the EBA’s Board, as well as a former chair of Payments UK’s PSD 2 Working Group.

PSD 2 is the kind of legislation that makes my head spin. However, I can promise a sort of clarity.