Data analytics and AI will be key with PSD2 and the new fraud landscape

The Second Payments Services Directive (PSD2) is a wide-ranging piece of European legislation that will transform the payments industry. Alternatively referred to as the'Open Banking' initiative, PSD2 promises to increase consumer choice in the payments sector. It will force banks, who have traditionally held a monopoly over the provision of payments services, to allow new, third party providers to'build on top of' their existing payments infrastructure and offer their own services. The directive, incoming in January, is of seismic importance to both banks and payments providers. Banks are sensing the need to move quickly so as not to simply become'utilities' similar to the water or telephone company, with only a small stable of products to offer.