For as long as we can remember, we have always been taught to not share our data and banking information with anyone, for good reasons of course. But a few years ago, this embedded belief was contradicted by the introduction of the Payments Service Directive 2 (or PSD2 for short).
This article addresses the biggest concerns consumers have with regards to PSD2 regulations and the challenges this imposes for banks, FinTechs and their customer relationships.
80% of Dutch consumers are not aware of the PSD2 regulations.
So the problem here is that too many consumers don’t really understand why they would share their transactional and banking details.
What is needed now is a serious discussion on how banks can build their customers’ trust while mitigating potential financial harm to merchants, consumers, and the economy. Because there truly are huge opportunities presented with PSD2.
While effects of PSD2 on banking has been well-researched, its impact on consumers has been remarkably under-examined.
There are simply not enough efforts by banks and financial institutions to increase consumer awareness of this law. What we have noted so far is that ING has released a short video briefly explaining the PSD2 law, and that the Dutch national bank launched a TV campaign about PSD2.
That being said, given that PSD2 requires the public to do something so counterintuitive such as sharing their personal information, we believe that there should be more effort in educating the public on how they can benefit from PSD2 opportunities.
Data security is another recurring concern when it comes to this directive and one that is totally viable. The European Banking Authorities, however, have gone to great lengths to showcase their data security guidelines under PSD2 in detail.
Additionally, companies that focus on data ownership and protection such as the Dutch consultancy firm Innopay are playing an active role in demonstrating the benefits of data sharing and how to navigate data security challenges.
42% of US consumers are suspicious of how secure their shared data is.
On a more positive note, we see a significant increase of transparency within Apps about data sharing. Is this the start of a trend to give the consumer more power over their data?
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