Consult Hyperion and CCgroup research revealed less than half of retailers were aware of PSD2 and 67% were not ready to comply by January 13th 2018.
PSD2 requires banks to grant third-party providers – including retailers – access to a consumer’s bank account to initiate payments and source customer data in a regulated and secure way. Designed to promote competition and innovation in the payments industry, the regulation will have unintended consequences that will reshape the retail sector. e research ‘Unaware, unprepared and paralysed: retailer readiness for PSD2’ was based on responses from over thirty tier one (turn- over above £500m) and tier two retailers (turnover between £30-£500m) in the UK.
“The impending shift to “Open Banking” through the implementation of PSD2 is one of the hottest issues in banking and payments. However, it seems that merchants and the wider retail technology community are unaware of the regulation and its far-reaching rami cations,” said Tim Richards, Principal Consultant at Consult Hyperion and co-author of the report. “ e use of two-factor authentication and access to customer bank accounts will allow retailers to dramatically lower card fees, mitigate fraud and limit the scope of data breaches. But arguably the biggest value is in access to consumer financial data that opens up new ways to do business.”