Payment Services Directive 3 (PSD3)

What it is

PSD3 is the proposed successor to PSD2, presented by the European Commission in June 2023 as part of a paired package: a new Directive (PSD3) for licensing and supervision, and a directly applicable Payment Services Regulation (PSR) for conduct rules. Final adoption and the application date are still being settled at the time of writing.

What is expected to change

• Stronger anti-fraud measures — including IBAN / name-checking obligations, harmonised liability for spoofing fraud, and tighter SCA exemption conditions.
• Open finance — extending the open-banking model beyond payment accounts to a broader set of financial data, under a separate Financial Data Access Regulation (FIDA).
• Merger of PSD2 and EMD2 — payment institutions and electronic-money institutions converge into a single licensing regime.
• Improved consumer protection — clearer rules on authorised push-payment fraud and refunds.

What it does not change

The core architecture of PSD2 — SCA, Article 96 fraud reporting, open banking — is preserved. Existing PSD2-compliant systems are expected to be substantially compatible, with additions rather than replacements.