With less than 6 months to go until the introduction of the Second Payment Services Directive (known more commonly as PSD2), new research from Intelligent Environments, the clear majority of consumers (89 per cent) are unaware of how this change will affect them.
Designed to increase market competition and improve customer experiences, PSD2 will allow third parties to gain the consent of consumers and access their financial data to provide new, innovative digital financial solutions. However, despite its proposed benefits, a study found that the vast majority of consumers simply weren’t aware of the impending change to law, or how the introduction of open-banking could benefit them.
Seeing The Positives
However, despite these concerns and the lack of awareness around PSD2, after being told of the benefits in store for them, many consumers are excited to see the legislation’s proposed benefits come to fruition. Over a fifth (21 per cent) are looking forward to being able to manage multiple bank accounts from a single app while over a tenth (11 per cent) expressed interest in receiving objective, third-party advice on better managing their finances.
A further 21 per cent believe it will be more convenient than ever to manage their money, and the same amount think it will provide a better overview of their money through digital finance. Despite financial institutions’ best intentions, there is still a lot of uncertainty and doubt around the introduction of PSD2, with consumers either unaware, or actively afraid of the new rules.
Despite these worries, the reality couldn’t be more different: PSD2 has been created with the consumer in mind, and is set to revolutionise the financial services industry, helping provide users with the option to better manage their finances while avoiding debt.
Of course, security is of utmost importance and while increased data sharing may set off some alarm bells PSD2 has many in-built safety functions to ensure confidential information stays safe. Crucially, consumers have to ‘opt-in’ to allow third parties access to their data, ensuring that no one sees financial details without their permission, unless you want them to.
For financial services organisations, the findings speak clearly: more must be done to educate consumers on the impending legislation, assuaging their concerns and making clear the industry-changing benefits that are still to come.