Trends & Vision

Key Regulations and Industry Initiatives (KRIIs)

Published on 20.11.2017

New Key Regulations and Industry Initiatives (KRIIs) aimed at competition and risk reduction have made the regulatory landscape even more complex. Currently, these are acting as a catalyst to infuse competition among service providers and to disrupt inertia in various segments of the payments’ value chain.

Third-Party Players continue to spur regulations to improve collaboration within the payments ecosystem

  • KRIIs introduced since the 2016 WPR focus on digital currency, cash-use reduction, FinTechs, and application programming interfaces (APIs).
  • With the revised Payment Services Directive (PSD2) January 2018 roll-out, Europe will take an important step toward becoming a fully interoperable digital market. Far-reaching effects across banks, payment service providers (PSPs), FinTechs, and corporates are expected.
  • Banks and PSPs face pressure from regulators to conform to Anti-Money Laundering (AML) standards and maintain reporting and liquidity norms.
  • An increasing emphasis by regulators on the reduction of risk at banks has given traction to initiatives such as Basel III’s Liquidity Coverage Ratio (LCR). Also, cybersecurity and data protection are witnessing a renewed focus, especially within the EU through the General Data Protection Regulation (GDPR) and Network and Information Security (NIS) directives.
  • The lack of regulator coordination and integrated data management among EU banks may create contradictory objectives and competing agendas while diminishing expected standardization and transparency.
  • Regulations related to KRIIs such as instant payments, cash reduction, and cybersecurity could act as catalysts for PSPs to create solutions that enhance customer satisfaction.

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