On the 15th of April, European Parliament voted on the text for the Payment Accounts Directive. This concludes the legislative process in Brussels that started with a Directive proposal on the comparability of payment account fees, payment account switching and access to payment accounts.
The Directive lists a number of requirements with respect to using standardised terminology and facilitating account switching for all payment services providers. It also provides a regime, applicable to credit-institutions only, to ensure the proper provision of basic bank accounts in Member States.
Impact of the directive for issuers of e-money
All E-Money Institutions will be subject to Title II and III of the Directive on the comparability of fees and account switching. However, anonymous products and those held by merchants will be out of scope, as will be products that offer limited functionality, for example those that do not offer cash access. From the products that remain, it is arguable that only those will be caught that are used ‘for day-to-day payment transactions,’ as set out in recital 12.
During the discussions on the Directive, the EMA had stressed that e-money products and payment accounts should be exempted from the scope of the Directive if they do not resemble bank accounts in their functionality or use. The final text reflects the discussions on this matter in recital 12:
The provision concerning the comparability of fees and switching should apply to all payment service providers, as defined in the Payment Services Directive. The provisions concerning access to payment accounts with basic features should apply only to credit institutions.
All provisions of this Directive concern payment accounts through which consumers are able to carry out the following transactions: place funds and withdraw cash, execute and receive payment transactions to and from third parties, including the execution of credit transfers. As a consequence, accounts with more limited functions are excluded. For example, accounts such as savings accounts, credit card accounts, where funds are usually paid in for the sole purpose of repaying a credit, current account mortgages or e-money accounts are in principle excluded from the scope of the Directive.
However, should these accounts be used for day-to-day payment transactions and contain all of the functions listed above, they will be captured. Accounts held by businesses, even small or micro enterprises, unless held in a personal capacity, are outside the scope of this Directive. Member States may choose to extend the application of this Directive to other payment service providers and other payment accounts, e.g. those which offer more limited payments functions.
It should be noted that the Member States have discretion to expand the scope of the Directive to accounts with limited functionality. Member States may also choose to oblige other issuers than credit-institutions to be involved in the provision of basic bank accounts.
Implementation
Member States will have two years to implement the Directive into national legislation, after which the rules become effective. National rules will therefore enter into forces in approximately mid-2016.
Before that date, Member States, the European Banking Authority (EBA) and the Commission will finalise further technical regulatory standards with respect to the presentation and content of a standardised fee information document, the statement of fees, and the terminology and services to be used by providers of payment accounts.