The Payment Services Directive 2 (PSD2) is a significant regulatory framework that impacts all payment service providers users in the EU, including platforms that facilitate transactions. 

PSD2 aims to create a more integrated and efficient European payments market, enhancing competition and innovation while ensuring robust consumer protection. The directive focuses on improving payment services and security, fostering innovation through open banking, and enhancing customer protection. 

To ensure compliance with PSD2, online platforms must meet a number of requirements.  The most important are requirements in terms of licensing, handling of funds and security measures.

The PSD2 key requirements for online platforms

Licensing Requirements

Platforms offering payment services must obtain authorization from relevant national authorities, as specified in Article 5 of PSD2. This involves meeting stringent operational and security standards. Platforms must prove they have the necessary risk management procedures and internal controls to safeguard customer funds and data.

This particular requirement could be considered as the most restrictive, as it often involves the allocation of significant resources and time.

Handling of Funds

Platforms acting as intermediaries cannot hold their customers’ funds unless they are properly authorized and regulated as payment institutions, according to Article 10. They must segregate client funds from their own and ensure these funds' safety. 

This requirement ensures that users' money is protected even if the platform faces financial difficulties. It is often handled by expensive payment service providers via their banking partners.

Security Measures

Platforms need to implement robust security measures to protect payment data, as required by Article 95. This includes regular security audits, incident reporting, and ensuring that all technical systems are secure. These measures help prevent fraud and unauthorised access to sensitive payment information.

Constant auditing and transaction monitoring often requires expert workforces and reliable IT infrastructures. Other requirements include ensuring transparency in fee structures, implementing strong customer authentication (SCA), and adhering to specific rules regarding consumer rights.

Online platforms, such as marketplaces, must comply with payment regulations to avoid legal penalties and substantial fines. To meet these requirements, platforms have two options: either develop their own payment solutions which require important resources or partner with third-party payment service providers, often expensive due to their use of traditional financial systems. 

ComplyPay’s Escrow wallet solution for online platforms

ComplyPay’s Escrow Wallet Infrastructure offers an intuitive payment solution designed to ensure full compliance with PSD2 regulations. By leveraging cutting-edge technologies, it seamlessly aligns with the needs of online platforms, relieving them from the burden of navigating complex legal requirements.

We offer a payment solution designed to meet the compliance, efficiency, and flexibility needs of online platforms. Our Escrow Wallet Infrastructure provides a modern approach to payments that aligns with our customers' products while ensuring full compliance. This can be done with key features such as single wallets for every vendors, secured escrow services and automation in either payment execution and compliance.

Integrated Wallet for Each Vendor

Every vendor on your platform gets a multi-currency wallet, allowing automatic split payouts. This enhances revenue from closed-loop payments and early payment options, ensuring transparency and fund traceability.

Automated Fund Release with Event-Based Payments

ComplyPay uses event-based payments triggered by business workflows and IF-THEN logic. This smart contract technology increases trust and reduces chargeback risks.

Embedded Escrow for Reduced Compliance Risk

ComplyPay's system includes an integrated escrow function, lowering the risk of holding third-party funds while ensuring compliance with regulatory requirements.

Robust AML/CFT Compliance

ComplyPay's infrastructure embeds strong anti-money laundering and counter-terrorism financing controls into every transaction, ensuring all financial activities meet legal standards.

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