24/09/2019
PSD2 Directive – what does it bring, and how to implement it?
A new EU directive striking hard on the world of eCommerce is called the PSD2 Directive. It is a new rule that all merchants operating in the EU will have to follow, and it brings a new level of security to the shoppers.
What does it mean?
The application of this new directive means that the shoppers from the EU will be more secure when buying online, using the “card not present” authentication. Now it will have to include 3 different steps in order to purchase.
At first glance, this is good news, as the fraud in online payments is not an uncommon thing in the past few years. Still, since the last step of the authentication includes either face recognition or biometric identification, it will bring some challenges to both shoppers and the merchants.
Some of the shoppers might feel that this way of authentication will go a tad too deep into their privacy, as personal data will have to be used on a level that was never present before.
The merchants, on the other hand, will have to improve their checkout experience if they wish to operate within the EU. This automatically means some further development and some further costs. Still, this is something unavoidable, and they will have to do it, regardless of their base of operations.
The sellers in the rest of the world don’t have to follow this directive, as it is mandatory only in the EU.
What about the UK?
Since the UK is in the process of BREXIT, this could be a somewhat confusing issue. The short answer would be that even they will have to abide by the rules enforced by the PSD2 if they wish to sell within the EU. However, those merchants who are targeting only the UK won’t have to implement this new rule.