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The future? Banks become open ecosystems and collaborate with fintechs

eW blog article - With the introduction of the Payment Services Directive 2 (PSD2), data of the bank customer, after his consent, becomes practically a common good. As of January 2018, banks are obliged to open up bank account details to third parties. This makes the PSD2 perhaps the most disruptive and exciting development in years. This introduction, combined with the possibilities offered by new technologies, will create opportunities for innovation and new digital business models such as paying with social media.

Open banking requires enhanced security such as Strong Customer Authentication

eW blog article - In general, there are three factors to identify yourself when making an electronic payment: something that you know (such as a PIN code), something that you possess (such as a telephone) and something that you are (such as a physical characteristic). Under PSD2, the Regulatory Technical Standards (RTS) for Strong Customer Authentication (SCA) requires that one’s identity has to be verified by at least two of these three independent options in order to perform a payment. What is SCA and why is it necessary for banks to enhance their security?