.svg)
The latest version of the SEPA Payment Account Access (SPAA) scheme rulebook came into effect at the end of last year, with optimism that it will benefit open banking and instant payments.
On Thursday (November 30), version 1.1 of the SEPA Payment Account Access (SPAA) scheme rulebook was implemented.
According to payment experts, this represents a significant milestone for the future of open banking, open finance and payments in Europe.
"SPAA, in combination with the Instant Payments regulation, is quite exciting,” commented Kjeld Herreman, head of strategy advisory at RedCompass Labs.
Herreman continued that the timing for SPAA is great, considering that it can serve as an overlay layer over real-time payments. “These more unified APIs (application programme interfaces) which can be leveraged to initiate instant liquidity transfers, can provide the foundation we need to unlock new use cases in e-commerce, recurring, and even point-of-sale payments.”
Facilitating data sharing and initiating transactions
The SPAA scheme rulebook covers the set of rules, practices and standards that will allow the exchange of payment accounts-related data and facilitates the initiation of payment transactions through "value-added" API-based services provided by account servicing payment service providers (ASPSPs) to third-party providers (TPPs), such as payment initiation service providers (PISPs) or account information service providers (AISPs).
Version 1.1 of the SPAA scheme rulebook includes sections that define a minimum viable product (MVP).
This covers a set of premium application programming interface (API) based services that an ASPSP participating in the scheme agrees to offer as a minimum to a TPP.
“With both the API specifications and the commercial model now done, the next few months will be all about getting the scheme up and running by setting up a directory, defining the billing mechanism, and launching a pilot,” said Andrei Cazacu, EU policy lead at TrueLayer.
According to Cazacu, SPAA will complement the reived Payment Services Directive (PSD2) and help bring account-to-account payments to many more merchants.
“It’s the start of a new chapter defined by more collaboration between banks and TPPs,” he said. “We look forward to supporting the adoption of premium APIs under the SPAA scheme.”
Unlocking SPAA’s potential
Charles Damen, chief product officer at Token.io, agreed, commenting that the SPAA scheme standards have the potential to help unlock enhanced functionality and innovation in payments and provide balanced commercial opportunities for both TPPs and banks.
“As a complement to the current free-to-use open banking APIs, the SPAA scheme will facilitate the delivery of a set of ‘premium APIs’ that banks can choose to offer for a default fee, or bilaterally negotiate lower fees with TPPs,” he said.
According to Damen, the richer functionality that the SPAA scheme will deliver will enable Pay by Bank solutions to reach their full potential.
Examples of such functionality include dynamic recurring payments, which are comparable to the UK’s commercial variable recurring payments and payment certainty mechanisms — both of which Damen said will help enable account-to-account payments to support use cases such as one-click checkout and point of sale.
“To now help drive towards making SPAA a reality, willing banks, and TPPs must start coming together to develop pilot initiatives that provide real-world testing of the model and functionality envisaged under the SPAA scheme,” said Damen.
In addition, he continued to suggest that as other regions such as the UK look to establish sustainable commercial models for open banking, the precedent being set by the SPAA scheme provides plenty to learn from.
Going forward, it is anticipated that the scheme will evolve further over time to support more elaborated functionalities, in line with market demand.
However, for now, there appears to be optimism that the scheme could help smooth the roadmap for payments innovation and open banking in Europe.
