How did the payment solution market evolve?
Olivier Berthelier: The PSD2 wasn’t even born when the number of payment methods started to explode. Before Visa and Mastercard launched 3DSecure a few years ago, bank cards didn’t always have a good image regarding the security of online payments. They might have been considered as unsafe by the payers and too expensive by the sellers, who also had to bear the cost of fraud. Also considering the fact that each country has its own payment habits, this led to the emergence of new payment methods such as iDeal, Sofortüberweisung, or Klarna.
What’s the impact of the PSD2 on online payments?
The PSD2 will not only encourage the emergence of this new type of actors but also regulate their activity. For example payment initiation services, that ease bank transfers, will need the status of Payment Institution, and guarantee a high level of authentication or provide a serious upstream risks analysis.
Simultaneously, the PSD2 will limit interchange commissions for bank card payments, which used to be paid by the final consumer. We can easily see the spirit of the PSD2, which is about improving the user’s payment experience, and to make it safer and cheaper.
What are the opportunities created by the PSD2 for the non-bank players in the field of e-payments and m-payments?
OB: It’s a revolution! A large number of new actors will enter the market and will have to offer value-added services to set their company apart from the competitors. For example, major firms might want to initiate the payments by themselves to improve the user experience, lower the costs and monitor the settlements. Payment services innovations, such as being able to have a one-screen overview of all of our accounts, or benefiting from a coach’s advice to manage our budget, are going to encourage the use of mobile devices in this sector and, as a result, foster the use of mobile as a payment device. This is one of the main concerns of the PSD2.
What about banks?
To my mind, this can also be a great opportunity for banks, obliged by the PSD2 to collaborate with “fintech”, because they will have to rethink their part in the digital revolution. Even though the DSP2 is encouraging these new innovating services, banks, on the other hand, are seen as more trust worthy by the consumers. Moreover, some “fintech” are perceived as very agile laboratories taken over by banks afterwards. For example, the information aggregation service Moneycenter, repurchased by Boursorama.
What are the changes for Limonetik?
At Limonetik, we consider the PSD2 as profitable. As experts in complicated payments, we are often approached by emerging actors who don’t fully understand the continuous changes that the financial world is undergoing.
Olivier Berthelier, CTO & Limonetik Co-founder