Status and next steps of Open Banking and PSD2

What is PSD2 and Open Banking?

The Revised Payment Services Directive (PSD2) is a European directive that was implemented in the fall of 2019 and has the task of regulating payment services and payment providers within the European Union as well as other parts of the European Economic Area (EEA). The purpose of the directive was to increase pan-European competition and participation in the payment industry also from non-banks, and to harmonize consumer protection as well as the rights and obligations of payment providers and users. Services provided with support of the PSD2 regulation is usually called Open Banking Services.


This article is written by Daniel Brühn, Key Account Manager at Smart Refill. It was first published 2020-06-10.

What does PSD2 & Open Banking mean to end consumers?

Instead of going to each individual bank to access your bank accounts and transaction data, you can now use a so-called PSD2 gateway and log in once to access all your bank accounts and transaction data, even if they’re in different banks. Some providers of digital services for the web and apps has started offering this kind of Opan Banking services – I’ll list some examples below.

Are we there yet?

Expectations were soaring in anticipation of the launch of the new payment initiative, but I believe that it has not yet proven in its full strength. One important reason is probably that banks have different interpretations of the legal requirements regarding how much data to make available via their APIs. While some banks see this as great opportunities to offer new services and are generous with the data provided, others perceive this as a threat to their core business and their relationship with customers and keep their available data to a minimum.

What Open Banking services can we expect going forward?

As banks’ data is made available to third party providers, we will see a large number of innovative services to guide the consumer on how to manage their own finances as well as simplified payments. I’ve identified 3 main areas where we will see new services going forward:

  1. PFM (Personal Finance Management) will get a boost as you (as an end customer) will have access to all your accounts in different banks / financial institutions and be able to get a comprehensive picture of your financial situation as well as tips on how to improve it with the help of PFM services that analyze your transactions. A good example of this service is TINK, which is one of the major players in this area.
  2. Neo-banks, ie digital banks, can build custom-made banks “on top of” the traditional banks’ systems by acquiring the customers financial information from other banks via a PSD2 gateway. Good examples of this are the Danish fintech company Lunar or the British Revolut.  
  3. Simplified payments. As mentioned before, as a customer you will now be able to access your transaction data from different banks in a much easier way – and through these initiate payments. You may have experienced that the payment solution asks which bank you use to show your transaction accounts after Bank-ID signing and let you choose which one to pay with before signing? In that case, it’s probably a payment initiation solution according to Open Banking / PSD2 you’ve come across! Klarna is one of the companies that has really taken care of this with simple payments – or as they themselves say “smooth”.

The winners of Open Banking

I think the winners of Open Banking will be the big banks who choose to boost their innovation and development capacity by partnering with Fintechs. They won’t be slowed down by internal IT capabilities or other factors, and can use their deep knowledge about their customers to tailor relevant services such as smart savings goals, mortgage rates adjusted to individual transaction history etc. In that way, they will be able to reduce churn and develop their relationships with the end customers.

In addition to this, the end customer is a big winner in the Open Banking era. Not only by being able to take advantage of new innovative services, but also because transparency will increase which in the long run should make all hidden fees disappear. The customer will take a well deserved step into the spotlight when the PSD2 and Open Banking is broadening the financial market.


This article is written by Daniel Brühn, Key Account Manager at Smart Refill. It was first published 2020-06-10.

Curious about Open Banking solutions?

Smart Refill has already launched Open Banking functionality for 23 Swedish banks. Will yours be the next? Drop us your contacts below and we’ll be in touch to explore what we can achieve together!