The revised Payment Services Directive will be a hot topic next year as it could mean a change in traditional banking as we know it, allowing third-party service providers to offer customers alternative banking services, says THOMAS PAYS, co-founder and CEO of i-Pay.
If you have not heard about the revised Payment Services Directive (PSD2) yet, get ready, there will be a lot of talk of it in 2017. Since the Council of the European Parliament passed the PSD2 legislation, the banking sector is bracing itself for a period of immense change, with a lot of companies set to get into the action over the next few years.
In a nutshell, PSD2 allows for, amongst others, digital role players to tap into payments systems traditionally considered the domain of the financial services system. Banks must, according to the regulation, offer third-party service providers ways to access customers’ accounts through open APIs (application program interfaces). This paves the way for the banking sector to evolve quite dramatically, eventually allowing for different types of companies and fintech startups to offer banking services to customers.
“You are actually looking at the collapse of the traditional banking infrastructure and a rebirth of banking as we know it.” These bold words come from Thomas Pays, co-founder and CEO of i-Pay, an Electronic Funds Transfer (EFT) payment gateway based in Johannesburg, South Africa. Pays believes through PSD2, banks are set to lose full control over account information, a key resource which, understandably, they never wanted to share with fintech companies. As innovative and agile as new fintech start-ups are, a number of them were hamstrung by this, with banks arguably stifling innovation and the growth of the industry.
PSD2 was adopted by the European Union (EU) in order to promote innovation in the payments space, improve consumer protection, and to incorporate new and emerging payment services typically provided through digital innovation. While PSD2 is first and foremost focussed on the EU, Pays notes that this regulation will affect South African banks too. “Several local banks have branches in the UK and Europe, and since these fall under PSD2 regulation – and also being on the same back-end as the banks’ South African systems – their whole structure would need to change in order to comply,” notes Pays. He describes the impact of the regulation as a ripple effect that will eventually touch banking in as many as 67 countries.
Here is, for example, the way PSD2 will change the online buying process. Currently, the way shopping is done online allows for a number of role players in the process, including the merchant and customer, the ‘merchant acquirer’ that processes credit card payments on behalf of the merchant, card schemes such as Visa, and finally the customer’s bank. PSD2 creates what is called a Payment Initiation Service Provider (PISP), a go-between which if given permission by the customer, initiates a payment bridge directly between the merchant and the bank. This is possible since PSD2 offers API access to the customer’s bank accounts, and it is in the role of PISP that fintech companies, such as i-Pay, will operate.
Who will benefit the most from PSD2? Pays believes that through the new banking ecosystem, the main winner will be the consumer, since it will not only be more convenient to transact online, but also safer. “PSD2 is taking online banking infrastructure and gearing it towards an environment which is stronger and more robust – much more so than the current method of buying online with credit cards,” he elaborated. The merchants too are set to benefit, since they are looking at much smaller transaction fees and more convenient ways to accept payments.
Pays believes that even though PSD2 opens the market for innovative companies, the exact type of innovation it might herald is not yet known at this stage. “PSD2 is going to shock the market not just on a technological level, but also with time through the innovation it will drive. At this stage, we can only speculate how banking is going to work in future,” Pays says.
Win a Poster Heater with Gadget and Takealot.com
This winter Gadget and Takealot.com are giving away three Poster Heaters, which look like posters but become heaters when you plug them in.
Three Gadget readers will each win a unit, valued at R550 each. To enter, follow @GadgetZA and @Takealot on Twitter and tell us on the @GadgetZA account how many Watts the heater consumes.
What’s the big deal about these heaters? Many of us are struggling to keep the balance between soaring electricity costs and the need to keep warm this winter.
However, the recently launched Poster Heater by EasyHeat and distributed in South Africa by Takealot.com is not only one of the most cost effective electric heaters currently on the market, it is also easy to setup and use.
As the name indicates, it is a poster similar to one you would hang on a wall. But, plug it in and it turns into a 300 Watt heater. The Poster Heater isn’t designed to heat hallways or large rooms, but rather smaller ones like a bedroom or a baby’s nursery or a dressing room.
It uses radiant heating, which means that it heats up in a couple of minutes and the heat is directed at the objects or people around it, quickly taking the chill out of the air and providing a comfortable ambient temperature.
The other advantage of radiant heating is that it doesn’t dry out the air like infrared or gas heaters. Users also don’t have to worry about their children or pets getting too close to it because, even though it gets hot, it can be touched.
To enter the competition follow the steps below:
Competition entry details:
3. The competition closes on 31 July 2018.
4. Winners will be notified via Twitter on 1 August and Takealot.com will be in touch to organise delivery.
5. The competition is only open to South African residents.
Happy Emoji Day! Here’s 10 reasons to be cheerful
First created by Shigetaka Kurita in 1999, the emoji has become a huge part of everyday communication. Whether you love them or hate them, flying dollar bills, applauding hands and rolling eyes are here to stay.
Scientist suggest that the use of emojis will help us gain the same satisfaction from digital interactions as we enjoy from personal contact.
Almost two decades later, and we have over 2600 unique emojis to perfectly express what we feel, thank you Mr Kurita! Join HMD, the home of Nokia phones as we celebrate World Emoji Day on the 17th of July with these interesting emoji facts:
The most popular emoji used is “Person Shrugging”
1. The Nokia 3310 was chosen as one of the first 3 “National” emojis for Finland… it represents unbreakable!
2. South Africa’s favourite emoji is the “Kiss and wink”… how sweet SA!
3. French is the only language where a ‘smiley’ does not top the list for its use
4. On average, over 60 billion emojis are sent on Facebook every day
5. For the first time ever, the Oxford Dictionaries Word of the Year was a pictograph! The “Face with Tears of Joy” was crowned word of the year in 2015
6. According to Emojipedia, some of the most requested emoji’s include afro, a bagel and hands making a heart
7. To include all races, a diversity pack was released in 2017
8. It has become so trendy that the Museum of Modern Art displays the original emoji collection on canvas
9. In 2009, Herman Melville’s classic Moby Dick was completely translated into emoji’s