Legislation towards a single payments area within the European Union : benefits, strategic opportunities and complexities presented by the Payments Services Directive

Abstract

This dissertation is a critique of the Payment Services Directive (PSD). By way of background, it also briefly discusses the EU legislative initiatives on retail payment services prior to 2007, as well as the self regulatory initiative by banks to achieve a SEPA. Particular provisions of Directive 1 of the Central Bank of Malta and the Financial Institutions Act (Cap. 376 of the Laws of Malta), which transpose parts of the PSD into Maltese law, are also examined. The dissertation does not, however, take into account any amendments, Financial Institution Rules and regulations made after the 31st May 2010. A comparative analysis is made of some provisions transposing the PSD, especially where options have been granted to Member States. This dissertation discusses whether the PSD establishes a single European payments area. It also analyses some of the benefits, opportunities and complexities presented by the PSD. Evidently, the PSD brings numerous benefits to consumers and imposes high compliance costs on existing payment services providers. The dissertation argues that there may also be some benefits for the latter. Specific issues posed by the PSD are also analysed such as whether the PSD provides a legal background for SEPA; whether the PSD allows a level playing field between different payment service providers; and whether the PSD provides for secure payment services. The dissertation finally also seeks to provide a domestic perspective.