Open banking platform Tink is calling for more leeway when it comes to implementing strong customer authentication (SCA).
The new regulations are part of the EU’s Revised Payment Service Directive (PSD2) and would force businesses to introduce new ways of ensuring people paying online are who they say they are.
The SCA regulations are set to go live on September 14. However, in an open letter, Tomas Prochazka, vice president of product at Tink, said many organizations are unprepared. He stated none of the financial institutions around Europe are compliant with the regulations, pointing at data collected when organizations around the EU opened up their PSD2 APIs to outsiders.
Prochazka warned that, with the deadline, “the open banking movement is in danger of stalling as a result.”
The Tink executive now calls for National Competent Authorities (NCAs), the national bodies responsible for overseeing PSD2 in EU member states, to be more flexible when it comes to implementing the new rules.
In particular, he asked for two things: to refuse to “grant fallback exemptions to banks whose APIs do not yet meet the required standards” and to “[foster] stronger industry collaboration to solve the problem.”
Commenting on the letter, Prochazka continued, “Showing greater flexibility around the implementation deadline is in everyone’s interest. Rather than rushing into a poor technological environment, we should recognize the state in which we are and give banks the time they need to get up to speed.
“Thankfully we are already seeing authorities the UK, France and Germany showing promising signs of this. Our experience tells us that banks are on board with the open banking journey. We must all now work together to make sure they can deliver so that open banking does not falter.”
In August, the Financial Conduct Authority agreed to phase in the new SCA rules in Britain across 18 months following the September deadline.
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