The EBA public hearing on Regulatory Technical Standards, specifying the requirements on strong customer authentication and common secure communication under PSD II, took place on September 23. The public hearing is an integral part of the consultation phase and regularly provides a summary of the initial consultation phase, as well as an insight into how the RTS are likely to shape up. Starting with the main points of development concerning RTS, which are reflected in the Consultation Paper [compare “Customer Authentication for Cashless Transactions: Impacts of the New RTS (Regulatory Technical Standards) under PSD II“ post], the major points of discussion during the hearing are detailed below.

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The regulator urges various initiatives for financial institutions to create access to data and information by third parties, whose seclusion is not justified. Details of this market opening in the financial industry, fostered by the Payment Service Directive PSD II, have been specified in two major points recently published as “RTS” (Regulatory Technical Standards) by the EBA: strong customer authentication and secure communication for electronic payment services. These regulations have major consequences on the current standards and established processes with cashless transactions.

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If we consider that 40 percent of global value creation is already based on information and communications technology, it is clear that secure and sound IT infrastructures will be an important factor in selecting a business location in the future. With Germany’s cyber security strategy, the German government is pursuing the goal of guaranteeing cyber security at the highest level, establishing Germany as one of the most secure digital locations in the world.

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The amendment to the Payment Service Directive (PSD II) follows the European regulator's intention to further strengthen competition in the field of payment services. Initiatives taken by financial institutions such as the ZOB interface (Central on-line banking interface) or FinTS (Financial Transaction Services), led to a variety of reasons for insufficient market acceptance.

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