EU Parliament Endorses Enhanced Payment Service Regulations for Stronger Consumer Protection

MEPs have endorsed proposals for a more open and competitive payment service within the European Union, emphasizing robust customer protection measures against fraud and data breaches.

The European Parliament on Tuesday backed amendments to both the Payment Services Regulation and Directive, with overwhelming support - the regulation adopted with 511 votes to 22 and 75 abstentions, and the directive with 484 votes to 8 and 118 abstentions.

According to a statement from the European Parliament, MEPs aim to achieve greater harmonization in payment and electronic money services across the EU. The proposed rules would apply to all payment service providers, including banks, post office giro institutions, and payment institutions.

Key aspects of the proposals focus on enhancing security for transfers and data. Measures include free verification of unique identifiers and strong customer authentication, with PSPs held responsible for compensating customers for losses resulting from fraud.

Moreover, customers' consent for processing personal data is emphasized, with provisions allowing them to opt out from data sharing or revoke access to their data.

Transparency in fee structures is another priority, ensuring that customers have access to clear and comprehensive information about charges prior to payment transactions.

Efforts to improve access to cash, especially in remote or rural areas, are also highlighted. Retail shops offering independent cash services up to €100 would be exempt from certain regulations, while lighter standards would apply to ATMs solely facilitating cash withdrawals.

Additionally, the proposals aim to facilitate the entry of new players into the EU payment services sector, particularly in internet payments. Regulation of such services would address concerns regarding liability, security, and data protection while maintaining technology neutrality.

MEP Marek Belka stressed the importance of these measures in protecting consumers and holding online platforms accountable for payment fraud. Ondřej Kovařík emphasized the enhancements to transparency in ATM withdrawals and the reinforcement of cash's role in society, particularly in rural areas.

The adoption of these laws represents Parliament's responsiveness to citizen demands expressed during the Conference on the Future of Europe. The legislation's passage closes the first reading, with further work to be undertaken by the new Parliament following the upcoming European elections from June 6 to 9.

By fLEXI tEAM