10 Dec 2024 Article

Essential EU Payment Regulations in 2025 – What You Need to Know

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How will new online payment regulations impact my business? It’s a question we at Brite come across often and something we pride ourselves on being ready to answer. And 2025 promises to be a busy year when it comes to payment regulations.

Indeed, the regulatory landscape in the European Union (EU) is rapidly evolving, with significant changes on the way. Many of these offer opportunities and improvements to existing rules and payment regulations.

The new updates highlighted in this article are set to enhance security, promote inclusivity, and ensure consistent compliance across member states for both businesses and consumers.

What are the four key payment regulations for 2025?

For businesses across the board, more often than not, “now” is the time when it is essential to remain compliant and competitive. This guide dives into four key payment regulations, offering practical advice to prepare for each:

Payment Services Directive 3 (PSD3)
The Digital Operational Resilience Act (DORA)
Anti-Money Laundering (AML) Package
The EU Accessibility Act

And without further delay, let’s get up to speed on one of our favourites, PSD3.

Focus 1: Understanding the Payment Services Directive 3 (PSD3)

What is PSD3, and why does it matter as a key payment regulation?

PSD3, along with the complementary Payment Services Regulation (PSR), represents a significant evolution in payment regulation. Designed to address shortcomings in PSD2, PSD3 enhances fraud prevention, strengthens consumer protection, and levels the playing field for non-bank financial institutions. These updates aim to create a safer, more competitive payment ecosystem across the EU.

Key implications of PSD3:

More robust customer authentication standards.
Enhanced fraud prevention mechanisms, such as confirmation of payee.
Mandated data access interfaces for open banking providers.
Elimination of discriminatory practices, such as IBAN discrimination.
For businesses facilitating payments, the time to act is (of course) now.

PSD3 and open banking competitiveness

PSD3 is set to revolutionise open banking by mandating dedicated access interfaces for Payment Service Providers (PSPs). Previously, banks could grant third-party access through user interfaces or fallback mechanisms, creating inefficiencies and roadblocks. Under PSD3, these barriers are being removed, fostering greater collaboration between banks and PSPs.

Key updates include:

Dedicated APIs for third-party providers (TPPs): Banks must implement separate APIs for open banking transactions, simplifying access for PSPs.
Permission dashboards for consumers: Customers will have enhanced transparency, with tools to manage which third parties can access their data and accounts.
These changes allow businesses to innovate and enhance user experience by offering or relying on payment initiation or account information services.

PSD3: Simplifying compliance through standardisation

The cornerstone of PSD3 is its emphasis on harmonising regulatory enforcement across EU member states. This addresses the inconsistencies present under PSD2, which allowed for varying interpretations at the national level. With the Payment Services Regulation (PSR) introduction, PSD3 aims to establish a uniform approach that reduces administrative burdens for businesses operating across borders, simplifying compliance requirements.

Key PSR updates include replacing PSD2 directives with directly applicable regulations and minimising member states’ flexibility in interpreting and enforcing rules. Additionally, a unified licensing regime for payment and e-money institutions will streamline business requirements for payment processing and e-money services. At the same time, standardised compliance obligations will ensure that businesses adhere to consistent rules regardless of the country in which they operate.

Want to learn more about these key EU payment regulations? Read more about PSD3 and PSR in our explainer.

Focus 2: Understanding the Digital Operational Resilience Act (DORA)

What is DORA, and why is it important payment regulation?

The Digital Operational Resilience Act (DORA, yes, this is the acronym) is designed to strengthen the financial sector’s defences against ICT-related risks, such as cyberattacks, operational disruptions and rogue coffee spills. By establishing unified requirements across the EU, DORA ensures that businesses of all sizes implement robust ICT risk management frameworks.

Why are third-party providers under the spotlight?

DORA introduces unprecedented oversight of critical ICT third-party providers such as cloud service platforms, data centres, and cybersecurity vendors. Financial entities must now actively manage risks stemming from these dependencies, ensuring their service providers meet strict regulatory standards. This focus on third-party oversight addresses concerns over service disruptions, lock-in risks, and cybersecurity vulnerabilities.

Key elements of DORA include:

Mandatory ICT risk governance frameworks for all financial institutions.
Oversight of third-party ICT providers, including cloud services.
A focus on resilience testing and incident reporting.
Compliance deadlines start in January 2025, so prepare for sweeping changes ASAP.

Complying with DORA, businesses must consider:

Establishing an ICT governance framework: This should include defined processes for detecting, assessing, and mitigating ICT risks.
Preparing for incident reporting: Businesses will need mechanisms to report ICT-related incidents within four hours of discovery. This requires advanced monitoring tools and well-trained personnel.
Conducting regular resilience testing: From penetration testing to system audits, regular evaluations will help ensure your ICT infrastructure meets regulatory standards.
Maintaining a register of information: Businesses must document all contracts with third-party ICT providers, including their roles in supporting critical functions.

By embedding ICT resilience into broader risk management strategies, businesses are best placed to mitigate disruptions and remain compliant.

To explore more about DORA, check out our DORA explainer blog from earlier in the year.

Focus 3: Understanding the EU Accessibility Act

What is the EU Accessibility Act?

The EU Accessibility Act is a directive to increase the inclusivity of products and services for individuals with functional impairments. It will become applicable on 28 June 2025 and ensures that businesses offering “everyday products and services,” including (and particularly important for this article) payment systems must prioritise accessibility in their design and operation.

Expanding accessibility beyond interfaces

The EU Accessibility Act doesn’t stop at improving the usability of websites and apps; it also extends to all communication channels businesses use to interact with customers. This includes ensuring that terms and conditions (T&Cs), privacy policies, and transactional information are easily accessible to users with functional impairments.

Key highlights of the directive include:

User interfaces such as websites, apps, payment terminals, and checkouts are covered.
Functional requirements rather than technical specifications, promoting flexible solutions for accessibility.
Potential consumer complaints to national courts for non-compliance.
This directive is a call to action for businesses in the payments sector to ensure inclusivity while enhancing user experience.

How businesses can prepare for accessibility compliance

To meet the requirements of the EU Accessibility Act, businesses should:

Conduct an accessibility audit: Evaluate digital interfaces, including websites and apps, to identify barriers for users with disabilities.
Incorporate user-friendly features: Add capabilities like text-to-speech, flexible magnification, and customisable colour contrasts.
Simplify language: Ensure that terms and conditions, privacy notices, and other critical content are written in clear, simple language.
Engage diverse user groups: Test your interfaces with assistive devices and gather feedback from individuals with varying accessibility needs.

Focus 4: Addressing the EU Anti-Money Laundering (AML) Package

What is the AML Package?

The EU Anti-Money Laundering (AML) Package introduces a comprehensive set of regulations to combat financial crime across member states. This includes harmonised Know Your Customer (KYC) requirements, stricter compliance measures, and the establishment of a centralised EU AML Authority. With deadlines beginning in 2025, the AML Package mandates new procedures for financial institutions, payment providers, and other businesses handling customer transactions.

Key components of the AML Package include:

Introduction of the 6th AML Directive and a new AML Regulation.
Extension of AML rules to new sectors like crypto asset providers and professional football clubs.
Increased KYC requirements, including data collection such as nationality and place of birth.
Creating a centralised UBO (Ultimate Beneficial Owners) Register to improve transparency.

How businesses can prepare for enhanced AML compliance

Compliance with the AML Package requires businesses to proactively adapt their processes and policies – it aims to tighten financial crime regulations significantly. Key steps include:

Enhance KYC procedures: Ensure your systems can collect and verify additional customer data points, such as nationality and place of birth.
Invest in fraud detection technologies: Machine learning algorithms and real-time monitoring tools can help detect suspicious transactions more effectively.
Train staff on AML protocols: Conduct regular training sessions to familiarise employees with the updated AML requirements.
Audit existing practices: Perform a gap analysis to identify weaknesses in your current compliance framework and address them before the deadlines.

A new centralised Approach to AML oversight

The EU AML Authority (AMLA) will play a pivotal role in overseeing compliance across the financial sector. Although direct supervision will be limited to select high-risk institutions, the AMLA will heavily influence national supervisory bodies, driving harmonisation and stricter enforcement of anti-money laundering rules. Businesses must prepare for this centralised oversight while adapting to more stringent penalties for non-compliance.

Key elements of the AMLA’s authority include direct supervision of certain high-risk institutions, such as large cross-border financial firms, coordination of national authorities to ensure consistent application of AML regulations, and the ability to impose penalties for non-compliance, with fines increasing to a maximum of €10 million or 2% of annual turnover – whichever is higher.

Preparing for stricter oversight

To effectively manage interactions with the AMLA and mitigate the risk of penalties, businesses should:

Centralise compliance documentation: Ensure all KYC data, transaction records, and beneficial ownership information are readily accessible for audits.
Implement advanced reporting tools: Automate the tracking and submission of suspicious transaction reports (STRs) to meet new timelines and requirements.
Monitor for high-risk entities: Establish processes to identify and prohibit business relationships with individuals or companies flagged by regulators.
Engage with national authorities proactively: Stay informed about local interpretations of the AML Directive and any stricter national rules.

With supervision set to begin in 2028, businesses can align their operations with AMLA’s expectations.

How to ensure compliance with EU payment regulations

As previously highlighted, the upcoming EU regulations in 2025 – PSD3, DORA, the Accessibility Act, and the AML Package (including AML 6th Revision) present a unified vision for a more secure, transparent, and inclusive financial ecosystem.

However, compliance with all of these will require businesses to act swiftly and strategically. By preparing in time, you can avoid penalties, enhance customer trust, and strengthen your positioning.

What you can do to ensure compliance with EU payment regulations in 2025:

PSD3 (and PSR):

Ensure you work with a payments partner that implements fraud prevention measures, such as confirmation of payee and enhanced strong customer authentication (SCA).
Keep updated with how financial institutions are upgrading systems to support dedicated APIs for open banking providers.
Centralise compliance processes to meet harmonised requirements under the Payment Services Regulation (PSR).

DORA:

Establish a robust ICT risk management framework, including incident detection and reporting tools.
Create and maintain a Register of Information for all third-party ICT contracts.
Conduct regular resilience testing to ensure operational continuity.

EU Accessibility Act:

If required, redesign user interfaces to ensure inclusivity, incorporating features like alternative text and magnification tools.
Optimise communication channels, including end-user transaction flows and customer support systems.
Regularly test with assistive technologies to ensure compliance.

AML Package:

Work with payment partners that are strengthening KYC procedures and investing in fraud detection technologies.
Centralise documentation and reporting processes to prepare for audits by national and EU authorities.
Stay vigilant for high-risk individuals or entities flagged under new AML protocols.

Finding a payments partner for mastering payment regulations

Compliance for meeting EU payment regulations isn’t just about meeting deadlines. It’s about choosing the right payment partners to work with to stay competitive in a rapidly changing regulatory environment. Act knowledgeably and swiftly, and you’ll position your business for a new era of payments and financial regulation.

If you would like to find out more about how Brite Payments stays compliant and provides fully regulated, next-generation instant A2A payments, get in touch today. One of our payment experts will be more than happy to assist you.