The Payment Services Directive

With the aim of achieving a Single Market in retail payment services that provides fair and open access to payments markets, and increases protection for consumers, the European Commission proposed the Payment Services Directive (PSD) in December 2005. The harmonised framework for payment service provision that will be established by the PSD will also provide the legal underpinning for the Single Euro Payments Area (SEPA). SEPA is a banking industry-led initiative that aims to develop a pan-European infrastructure for payment schemes, namely credit transfers, direct debits and card payments.

The PSD, which was adopted by the Council and European Parliament in November 2007 and published in the EU Official Journal on 5 December 2007, introduces a new EU-wide licensing regime for non-credit or e-money institutions, known under the Directive as 'payment institutions.' This will allow such providers to offer their services EU-wide on the basis of a licence obtained in one EU Member State. The PSD also harmonises conduct of business rules for all EU providers of payment services.

It is stipulated in the PSD that Member States must implement its provisions into national law by 1 November 2009. The Government proposes to implement the Directive in an effective, proportionate, and risk-based manner. By means of a three-stage consultation process, which is due to conclude in autumn 2008, the Government continues to develop its approach to the legislation.

Media links

Documents and publications

In July 2006 the Government sought stakeholders views on the UK's approach to negotiating the Payment Services Directive in the Council of Ministers and the European Parliament:

In December 2007 the Government consulted on how it proposed to implement the Directive in an effective, proportionate, and risk-based manner. This consultation discussed the Government's proposed approach to implementing each Title of the Directive:

This summer the Government is consulting on the legislation that will implement the PSD. This document forms the final phase of the three-part consultation process. The Government aims to lay the final legislation before Parliament before the end of the 2008. This timescale aims to offer UK businesses the longest lead-time possible in which to adjust to the PSD requirements before they come into force on 1 November 2009. Stakeholder views are invited on any aspects of the proposed legislative measures in the consultation.

The consultation will be open for a 12-week period from 21 July 2008 and will close on 3 October 2008. Responses to the consultation can be e-mailed to PSDconsultation@hm-treasury.gov.uk. A summary of responses will be provided in autumn 2008.

Related links

External links

Some of the documents are available in Adobe Acrobat Portable Document Format (PDF). If you do not have Adobe Acrobat installed on your computer you can download the software free of charge from the Adobe website. For alternative ways to read PDF documents and further information on website accessibility visit the HM Treasury accessibility page.

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