The Payment Services Directive (PSD) was passed in December 2007. It provides the legal framework to harmonise the payments market and applies to all currencies in the EU. On 2 November 2009, the PSD was implemented in national law throughout the EU making SEPA Direct Debit a reality.
Adhering to the PSD could require more change for banks and their customers than SEPA. Banks need to understand how the PSD affects their individual business units and service lines and ensure that all staff are fully prepared. The PSD also affects the relationship between banks and their customers, so they need to work closely with their customers during the implementation.
The three primary objectives of the PSD are:
- To enhance competition within and between national markets and ensure a level playing field
- To increase market transparency for both payment service providers and users by establishing clear and consistent rules
- To standardise the rights and obligations of payment service providers and users