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The Payment Service Directive (PSD2) became effective on the 14th of September 2019. The directive aims to standardize the market, strengthen customer safety, and support technical innovation through increased competition. The new standard requires stronger identity controls, with for example two-factor authentication for online payments.
PSD2 is an updated version of the current payment service directive, PSD. The biggest difference between the two is that banks will now be forced to make their API:s more open and accessible. A result of this is that third-party services can use the banks' customer data and infrastructure. If the client first authorized it, internet payments can be initiated directly from the client’s bank account. The directive enables more companies to enter the market and compete with traditional banks.
The PSD2 directive imposes new safety requirements in terms of product and system development. Here are some of the requirements: