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Hogan Lovells PSD3 Impacts Report: Latest edition incorporates Council of EU’s position – next stop inter-institutional negotiations on final texts
05 September 2025
Whilst the legislative proposals for a Directive on payment services and electronic money services (PSD3) and a Regulation on payment services in the EU (PSR) will require payment service providers (PSPs) to make changes, this latest chapter in EU payments regulation is slightly more “evolution” than the “revolution” of its predecessor, the second Payment Services Directive 2015/2366 (PSD2). However, many of the required changes will be significant and challenging - particularly in terms of the technology and operational projects that will be required. With the June 2025 publication of the Council’s amended PSD3 and PSR texts, the legislative process is heading towards its final stages as inter-institutional negotiations begin. We have taken this opportunity to update our PSD3 Impacts Report to include the Council’s key proposals as we await the finalised legislation and implementation timelines.
What’s in the PSD3 Impacts Report?
Our PSD3 Impacts Report summarises the impact of the PSD3 and PSR legislative proposals thematically, highlighting the areas where the EU trilogue process might shift the dial further before the texts are finalised, and flagging where changes might need to be reflected in PSPs’ businesses.
The proposals would affect different payments market players in different ways, so there’s something for everyone in the Report.
For those in need of a very quick overview, the Report also includes an “at a glance” table mapping the changes, and a synopsis of the legislative process to date and expected timing.
What’s new in this latest edition of the Report?
The first edition of the Report, published in October 2024, incorporated key elements of the European Parliament’s proposed amendments to the European Commission’s June 2023 legislative proposals.
The Council of the EU’s drafts of PSD3 and the accompanying PSR were approved by the member states' representatives (COREPER) on 18 June 2025, meaning that the trilogue process (inter-institutional negotiations) can now begin. This latest edition of the Report includes key elements of the Council’s proposed amendments. The themes covered are as follows, with new themes shown in bold:
- Authorisation/Re-authorisation and changes to the e-money regime;
- Electronic money tokens;
- Transaction monitoring and data sharing;
- Scope of application and exemptions;
- Access for PSPs to payment systems and services;
- TPP access;
- TPP dashboard;
- Strong Customer Authentication (SCA);
- Confirmation of Payee;
- Impersonation fraud;
- Liability;
- Surcharging;
- Card scheme fees;
- Platform for fraud prevention; and
- EBA powers of intervention.
What’s the potential implementation timeline?
COREPER’s approval of the Council’s amended PSD3 and PSR texts on 18 June 2025 paved the way for inter-institutional negotiations on the final texts to begin. Trilogues can often be a long process, however, there is strong appetite to get both files concluded under the Danish presidency which concludes at the end of the year.
At present there is an 18-month implementation period (although the Council proposes to extend this to 24 months). As such, the earliest PSD3/PSR is likely to become applicable is H2 of 2027, although this could move into early 2028 if the Council is successful in extending the implementation period.
Want to know more?
Click here to download our updated Report.
We have extensive experience of advising on regulatory change projects, including the previous significant overhaul of the EU payments regulatory landscape under PSD2.
If you have any questions arising from the Report, please get in touch with one of the listed people or your usual Hogan Lovells contact.
Authored by Eimear O'Brien, Charles Elliott, Lavan Thasarathakumar, and Virginia Montgomery.
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