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The European Banking Authority (EBA) has shared a new set of Q&As related to the payments and e-money sector, resolving queries put to it by various stakeholders.
In the Q&As, the EU’s finance watchdog addresses an array of regulatory issues under both the Payment Services Directive (PSD2) and the Electronic Money Directive (EMD2):
- ATM withdrawal services: Whether cash ATM withdrawal services provided through agreements with major payment schemes fall outside PSD2's scope if they do not act directly on behalf of card issuers.
- Netting centres and payment services: Whether netting centres, which calculate net amounts owed between parties and facilitate fund transfers, qualify as payment service providers (PSPs) under PSD2.
- Payment accounts and e-money accounts: Clarification of the differences between payment accounts, e-money accounts, and bank accounts, including the eligibility of using these accounts for salary payments.
- ASPSPs’ obligation to provide card data: Whether account servicing payment service providers (ASPSPs), usually banks, need to provide card details to account information service providers (AISPs) under PSD2.
- Gift cards as e-money: Whether gift cards issued by electronic money institutions (EMIs) should be classified as e-money at the point of sale.
ATM services and their PSD2 exemption
A question submitted by an EU member state’s national competent authority in 2022 asked whether a third-country provider offering ATM withdrawal services through agreements with major payment schemes falls outside of PSD2 licensing requirements.
As it stands, according to Article 3 in PSD2, certain ATM operators are exempt from licensing if they act on behalf of card issuers, are not part of the customer's framework contract, and do not provide other payment services.
In this case, the provider argues that it meets the conditions for exemption under PSD2. It claims that acting on behalf of card issuers is fulfilled through an agreement, established under common card scheme rules, such as those of Visa or Mastercard, between the issuers and the ATM operators.
The provider believes that these agreements, which govern technical and business rules for the transactions, should qualify as sufficient cooperation with card issuers to satisfy the exemption criteria.
The EBA's response to the national competent authority clarifies that ATM operators meeting these criteria can indeed be exempt, provided that they act on behalf of card issuers through agreements that govern the transaction's technical and business aspects.
Whether an operator qualifies depends on the specific terms of these agreements.
Netting centres and payment services
Another question explores if an international non-profit association acting as a netting centre under a multilateral agreement should be considered a PSP under PSD2, as the association's netting system consolidates funds among members, calculating payables and receivables before executing transactions.
The EBA concludes that since the association acts as both payee and payer, rather than providing a service to its members, it does not meet the definition of a payment service provider under PSD2.
This interpretation aligns with previous Q&As, emphasising that such activities typically fall outside payment service regulations unless specific exclusions apply.
Payment accounts, e-money, and bank accounts
The Q&As also shed light on the distinctions between different types of accounts.
The EBA states that a payment account might contain either e-money or bank money but cannot easily combine both, clarifying that PSPs can handle accounts with either type of funds, whereas only e-money or credit institutions can issue e-money — something the European Courts of Justice judgement on ABC Projektai clarifies.
The watchdog also clarifies that salary payments could be made into an e-money account if the funds are either issued as e-money or converted upon receipt.
This guidance helps delineate the roles of various financial institutions in handling different types of accounts under PSD2 and EMD2.
ASPSP data sharing requirements
Another question that was submitted to the regulator last year asked the EBA if ASPSPs must provide the card number (PAN) associated with a payment account to an AISP if the payment service user (PSU) can view this data in their online banking session.
It also raised concerns about whether the third-party provider (TPP) fetching this data needs to be PCI DSS certified, given the security requirements for handling card data.
The EBA clarifies that card details are considered payment instruments, not part of the payment account itself, and that ASPSPs are not required to share this information with AISPs under PSD2.
Gift cards and e-money classification
The classification of "gift cards" issued by EMIs was another topic raised to the EBA.
The question, submitted by an employee at the Banca d’Italia, asked whether vouchers or gift cards issued by an EMI, which are used to top up an e-money account for purchasing goods and services, should be classified as e-money at the time of sale or only when the funds are used to make purchases, particularly when those purchases involve third-party merchants.
The EBA confirms that these cards qualify as e-money at the point of sale when they are intended to top up an e-money account, in line with Article 6 of the EMD2. The issuer must treat the funds as e-money immediately, ensuring compliance with regulatory requirements.
