Data obtained from our platform underscores the importance of PSD3
In a significant move, the European Union is preparing to implement PSD3, an amendment to its payment regulations, which is expected to level the playing field between banks and non-banks providing payment services. This development comes as the global B2B and consumer money transfers market is projected to reach a staggering $56 trillion by 2030, according to a new report by our platform.
The report, authored by Joe Baker, reveals that the European payments market was $11.94 trillion in 2022, with $11.94 trillion being sent from the European Economic Area (EEA) to other countries globally. Cross-border payments within the EU accounted for approximately 40% of the total payments market, while B2B payments made up 88% of total EEA outbound flows, including intra-EEA payments.
The report further highlights that payments sent to countries outside the EEA totaled $4.64 trillion in 2022, emphasizing the significance of cross-border payments within the EU. The report, however, does not disclose the methodology used to gather and analyze the data presented.
PSD3 aims to drive a transformation in the EU cross-border payments market by enforcing regulatory clarity, supporting real-time payments infrastructure, and facilitating the adoption of new payment technologies under robust consumer protection standards. The new regulations are designed to improve efficiency by lowering transaction costs, reducing settlement times, and enhancing transparency for international payments.
The report suggests that PSD3 will also align with the new Payment Services Regulation (PSR) to replace fragmented national rules with a harmonized regulatory framework, promoting a truly unified EU payment market. This modernization fosters innovation while tightening liability frameworks, dispute resolution, and fraud prevention measures, which is crucial for both B2B and consumer money transfers in cross-border contexts.
Moreover, PSD3 will provide transparency for consumers on ATM charges, account statements, and remittances from the EU to non-EU countries. The regulations also aim to expand open banking within the EU and compact and mitigate payments fraud.
While preparing for new regulations may be burdensome for payments providers, the benefits of building a more harmonious national payment system across the EU will complement the growing global B2B and consumer money transfers market. Companies operating in the EEA and the cross-border space may be required to make changes to their services due to PSD3.
Joe Baker, the report author, believes that the benefits of a standardized and harmonious payments system within the EU, as a result of PSD3, will support the growth of the global cross-border payments industry. The anticipated impact of PSD3 on the EU cross-border payments market includes enhanced consumer protection, improved efficiency, and stronger regulation of emerging payment technologies.
In conclusion, PSD3 is set to drive a seismic shift in the EU cross-border payments market, enforcing regulatory clarity, supporting real-time payments infrastructure, and facilitating the adoption of new payment technologies under robust consumer protection standards. This transformation is expected to enhance the competitiveness and security of the global B2B and consumer transfers ecosystem within Europe.
[1] Report: The Impact of PSD3 on the EU Cross-border Payments Market [2] PSD3: A New Era for Real-time Payments in the EU [3] PSD3: Harmonizing EU Payment Regulations for a Unified Market [4] PSD3: Enhancing Consumer Protection in Cross-border Payments [5] PSD3: Embracing Innovation in the EU Payments Landscape
- The report by Joe Baker indicates that the implementation of PSD3 in the European Union could significantly contribute to the growth of the global cross-border payments industry, given its focus on enhancing consumer protection, improving efficiency, and fostering innovation in payment technologies.
- As the global B2B and consumer money transfers market is projected to reach $56 trillion by 2030, the finance, technology, industry, and business sectors are closely watchful of regulations like PSD3 that aim to transform the EU cross-border payments market, particularly by enforcing regulatory clarity, supporting real-time payments infrastructure, and facilitating the adoption of new payment technologies under robust consumer protection standards.
