The European Banking Authority (EBA) published clarifications to the sixth set of issues that had been raised by participants of the EBA working group on Application Programming Interfaces (APIs) under the second Payment Services Directive (PSD2). The clarifications respond to issues raised on authentication with electronic signatures, biometrics and authentication on mobile applications, preventing social engineering fraud, ability of payment initiation service providers to refuse a payer’s request to initiate a payment transaction, and complexity in the authentication process.
The EBA working group on APIs, which is tasked with identifying issues and challenges that market participants face during use of API interfaces, had raised these issues post its mid-June 2021 meeting. The group is also asked to propose solutions on how the identified issues could be addressed, which EBA and national authorities will then consider when providing clarifications in response to the issues raised. The aim of the group is to facilitate industry preparedness for the regulatory technical standard on Strong Customer Authentication and Common and Secure Communication and to support the development of high-performing and customer-focused APIs under PSD2. EBA had, in January 2019, established this work group, which consists of 30 individuals representing account servicing payment service providers, the third party providers, API initiatives, and others market participants.
Keywords: Europe, EU, Banking, API, Application Programming Interface, PSD2, COVID-19, AMLD, Fraud Detection, EBA
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