Payment Services Directive | Royal Bank of Scotland

Payment Services Directive

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The Payment Services Directive (PSD) came into force on 1 November 2009 with the goal of making payments across Europe more efficient and easier to understand.

A standard payments process

The Directive is intended to make cross-border payments as simple and secure as payments within the national borders. The Directive provides a regulatory framework for payments throughout the European Economic Area (EEA). It applies to bank and non-bank Payment Service Providers (PSPs) in the European Union (EU), Norway, Iceland and Liechtenstein. The Directive sets out regulations on account information and payment transactions in Euro, sterling and other EU and EEA currencies. Cheques, drafts and other documents drawn on a PSP are not covered by the PSD.

Benefits for customers

A standardised service for payments across Europe, supported by a common legal framework.

Improved protection

Provide consistent rights and obligations for businesses and consumers making and receiving payments.

Clearer approach

Through common understanding of each party’s rights and obligations.

Enhanced information

Provided in the contract terms and conditions as well as increased transparency on the payments themselves.

What this means for you

Since 1 January 2012 the Directive requires that UK sterling domestic payments and payments in Euros within the EEA must reach the beneficiary’s PSP no later than the business day after the payment instruction is received by the payer’s PSP. Within the UK this means that most standing orders, telephony and internet banking payments are now made via the Faster Payments Service, with funds reaching the beneficiary’s PSP on the same business day as they leave the payer’s account.

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