Security & Fraud

PSD2 Creates Turbulence For Travel Operators

With PSD2 in full swing in the European Union (EU), any merchant dealing with the payment data of EU citizens must upgrade their payment protocols to stay compliant.

That said, the fact that PSD2 is effectively changing how merchants transact doesn’t mean the merchants in question understand what those changes mean. In the January PSD2 Tracker™, PYMNTS examines how money movement and data flow are getting an upgrade with PSD2, as well as how the upcoming SCA regulation is bound to affect user authentication. The Tracker also looks into how PSD2 could potentially serve as guidance for other countries that may be reevaluating their own rules on data privacy and payments.

What’s New In PSD2

PSD2 may have a greater effect on payments, even outside the EU, as consumers all over the globe are clamoring for more data security. Eighty percent of U.S. consumers, for instance, want the right to know where their personal data is and how it's being used, according to recent surveys.

Meanwhile, to help along some of the companies that are still confused about how to comply with GDPR and PSD2, the European Data Protection Board (EDPB) has issued regulatory guidance on the topic. Despite GDPR coming into effect a full six months ago, 50 percent of European merchants still aren’t compliant with the regulation.

Additionally, GDPR has to deal with some growing pains. More than 3,200 GDPR breaches were logged within the first seven months after the regulation went into effect, which means the open data flow it supports may need to come with better fraud protections sooner rather than late.

Visit our News and Trends section for more information on the impact of PSD2.

PSD2 And The Future Of Travel Payments

PSD2 is already having a strong impact on the travel market, with merchants ranging from airlines and hotels to travel aggregators working with third-party services, deploying new authentication standards while still adapting to changing customer preferences. The challenge, according to Jean-Christophe Lacour, head of merchant services for payments processor Amadeus, is balancing the need for stronger authentication with a frictionless experience.

“In the past, typically retailers — not just travel companies — had to make a choice really between frictionless [payments] and security,” he said. That’s no longer an option with PSD2 — now, retailers need to provide both.

Read more by downloading the Tracker.

About The Tracker

The PSD2 Tracker™, powered by Whitepages Pro, is the go-to resource for monthly updates on the trends and changes regarding PSD2, and other privacy and data protection regulations.



The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.