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Expert opinion

Merchants' must-read guide to dealing with PSD2

Wednesday 22 November 2017 | 10:42 AM CET

John Snoek from Acapture discusses practical facts on PSD2 and the best way for companies using online marketplace models to tackle the fast approaching regulation.

The challenge – what is it all about?

2018 is set to not only bring new trends and developments as each year does but drastically change a major part of the European ecommerce sector.

PSD2, or the Payment Services Directive 2, brings serious changes regarding how transactions are being handled throughout Europe. This does not just affect European merchants, but also companies from Asia, the US and the rest of the world looking to expand their business in the EU. Moreover, PSD2 will have a big impact on a particular ecommerce business model: online marketplaces.

Handling transactions between sellers and buyers makes marketplace model businesses subject to PSD2, a regulation that aims to provide a more secure shopping process and more choices for consumers. What are the marketplace model companies, exactly? They can range from retail giants like eBay and Amazon to food delivery companies such as Foodora or Deliveroo and travel operators such as Airbnb that connect travelers with accommodation owners.

PSD2 deadline and how merchants can meet it

PSD2 is scheduled for implementation coming January, giving the affected operators two options: obtaining a payments institution license or partnering with a payment service provider that holds such a license and removes the obstacles created by the regulation.

Applying for a payments license requires hiring a few teams of experts beforehand, have the company’s senior management take a series of compliance tests, limitations to employee bonus schemes and also a significant amount of capital. The application process usually takes between 6-12 months. Meanwhile, your business may be compromised from a regulation point of view, being subject to penalties for non-compliance. In addition, the costs of the payments license can reach up to EUR 200,000 in some cases, with no guarantee that you will eventually receive the license at all.

The second, an easier and more secure alternative is partnering with a reliable partner who can help with all the regulation complexities. We, at Acapture, let merchants focus on growing their business and take care of the PSD2 and payments barriers. With our marketplace solution SlicePay, merchants have a flexible, cost-effective and quick way to become PSD2 compliant. It’s actually what I like to call: PSD2 compliance felt easy due to the quick integration and no upfront fees that allow merchants to get on with their business without interruptions or regulatory penalties.

In addition to being a profitable PSD2-compliant solution, SlicePay also manages complex payouts to various partners through an automated system. The merchant receives a single payment from the buyer, which SlicePay splits between the sellers, in compliance with all regulations, in the right currency and at the right time.

Are you ready for PSD2?

The deadline for PSD2 is January 2018. In the majority of the countries across the EU, the legislation has been either implemented or is expected to be shortly implemented with changes projected to come into effect starting from January. However, in the Netherlands, the deadline for the legislation has been pushed towards the spring of 2018 due to the market’s overall lack of readiness for PSD2 implementation. Marketplace operators should not lose any time. In fact, they should take advantage of this extended timeframe, get informed regarding this topic and prepare accordingly.

It’s understandable that merchants might feel overwhelmed at this time of the year, given the amount of things they have to keep track of for their business. That’s why they must stay properly informed on whether or not they qualify under PSD2 and, if so, what steps they need to take before the regulation comes into effect.

To find out whether your business will be affected by PSD2, take the test.

About John Snoek

John Snoek, VP Product & Operations at Acapture, has over 20 years’ of go-to-market experience in product development, management and launch. Prior to joining Acapture, John was responsible for global marketing and product management, being also one of the pioneers in the field of alternative payments.

 

About Acapture

Acapture is the subsidiary company of Payvision, one of the world’s fastest growing global acquiring networks. Licensed as a payment institution by the Dutch Central Bank, Acapture offers a complete data-driven omnichannel payment solution, capable of managing a payment at every stage, from checkout to fund collection to settlement. Acapture specialises in maximising revenue for merchants and marketplaces with international ambitions.

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