PSD2 and the Transformation of the Business Model of Payment Services Providers

E. Bani, V. De Stasio, A. Sciarrone Alibrandi (2021), The transposition of PSD2 and open banking, Bergamo University Press.

17 Pages Posted: 16 Apr 2021

See all articles by Alberto F. Pozzolo

Alberto F. Pozzolo

Università degli Studi di Roma Tre

Date Written: April 2, 2021

Abstract

The provision of payment services is one of the most important activities performed by the financial sector. Traditionally, most of these services have been offered by banks, although in the last decades non-bank financial institutions have gained a prominent role in some specific segments, for example in the credit card business. In the past, despite being a relevant source of revenues for banks and other financial intermediaries, payment services provision has ranked relatively low in the interests of policy makers and academics alike, with most of the attention focused on the soundness of the system rather than on its efficiency. In recent years, this landscape has changed dramatically. New players have entered the market, in some cases increasing the degree of competition to the benefit of customers, in other cases exploiting network economies of scale and their better and exclusive know-how to gain significant market power. The purpose of this chapter is to discuss how some of the innovations introduced by the PSD2 might impact the business model of payment service providers in the coming years, what the effect on the equilibrium in the industry will be, what new risks may emerge, and what actions should be taken to counter possibly undesired outcomes. The analysis in this chapter will focus mainly on the potential impact of the introduction of three new types of intermediaries, known as Third Party Providers (TPPs): Payment Initiation Service Providers (PISP), Account Information Service Providers (AISP) and Card-Based Payment Instrument Issuers (CBPII).

Keywords: PSD2, payment system, PISP, AISP, bigtechs

JEL Classification: G28, K21

Suggested Citation

Pozzolo, Alberto F., PSD2 and the Transformation of the Business Model of Payment Services Providers (April 2, 2021). E. Bani, V. De Stasio, A. Sciarrone Alibrandi (2021), The transposition of PSD2 and open banking, Bergamo University Press., Available at SSRN: https://ssrn.com/abstract=3818326

Alberto F. Pozzolo (Contact Author)

Università degli Studi di Roma Tre ( email )

Via Ostiense 163
Roma, RM 00154
Italy

HOME PAGE: http://www.uniroma3.it/

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
122
Abstract Views
274
rank
290,440
PlumX Metrics