PSD2 is the European directive that regulates electronic payment services in the euro area. The new regulation, which updates the one from 2007, introduces strong measures in the field of cybersecurity. 11Onze will be guided by this directive. We explain its advantages to through agent Jordi Oller.

The new PSD2 directive came into force in Spain in December 2020, following the approval of Royal Decree-Law 19/2018 on payment services. This regulation sets out the rights and obligations of both institutions and customers with regard to payment services. “It seeks to meet the security needs in a context of strong technological advances in the field of e-commerce,” Oller explains.

PSD2, therefore, regulates all payment transfers, direct debits, card payments and other banking transactions in Europe, and aims to make all payment services in the financial sector more transparent, more competitive and more innovative.

Protecting ourselves from cyber-attacks

First, PSD2 introduces strong measures in the field of cybersecurity. Among other things, a double authentication or reinforced authentication when allowing banking transactions, a procedure that substantially reduces the risk of identity theft. It is for this purpose that financial services institutions have to offer their customers an API, i.e. an Application Programming Interface. “The new APIs give flexibility, simplify design and use and allow innovation in new services,” says our agent 11Onze. At the same time, these financial institutions have to share information with other companies, as long as they have the customer’s consent.

In addition, now, with PSD2, companies cannot access customers’ sensitive financial data. And banks have to establish account access, the so-called XS2A, which is popularly known as open banking, because they are obliged to provide the necessary interfaces so that people can access their account data, provided they have given their consent. “So, for example, users can view all their accounts in one place or make online payments by bank transfer,” Oller explains. You may have read it at La Plaça. From October 1st, 11Onze’s interface will be El Canut, a state-of-the-art application, a digital wallet where you can make all kinds of different transactions and manage several accounts at the same time. 

The new PSD2 also offers solutions to ensure that transferring of sensitive data, via APIs, is carried out without any risk for the client and that data protection is guaranteed by two different means: the QWAC certificate and the QSealC certificate. For online transactions, therefore, it is no longer sufficient to ask for the customer’s debit or credit card, but a double authentication (Strong Customer Authentication, or SCA) is also required. In short, at least two of the following three factors are required for a transaction to take place:

• What the client has, such as a debit/credit card or mobile phone.
• What the client knows, e.g. a bank password or a PIN that is sent to the mobile phone.
• Who the client is, i.e. an ID, be it a fingerprint or facial recognition, some biometric identification parameter.

Less fraud, better online shopping

All in all, PSD2 makes e-commerce much safer, because it prevents fraud through stolen or duplicate cards and avoids chargebacks. In addition, it also makes online shopping more user-friendly. “It facilitates authentication processes, thanks to biometric identification parameters or mobile payments instead of card payments,” explains our agent 11Onze.

Last but not least, PSD2 provides incentives to reduce the costs of online transactions. “It frees up access to banking interfaces, and allows more companies to compete in this payment ecosystem,” Oller concludes. It should be noted, however, that only transactions where the card issuer is European, i.e. from the 27 EU countries, or where the acquirer, or the financial institution that processes the transaction on behalf of the merchant, are also European, will be subject to PSD2. Undoubtedly, what is clear is that with 11Onze you are going to be secure.

Want an 11Onze account? Order batch in Get in line. With the code we’ll give you, you can open an account on October 1st.