EU reaches political agreement on Payment Services Directive 3 and Payment Services Regulation

On November 27, 2025, the European Parliament and Council announced they had reached a provisional political agreement on the proposed Payment Services Directive (“PSD3”) and Payment Services Regulation (“PSR”), a legislative package intended to modernize the European Union’s payments framework and replace key elements of Payment Services Directive 2 (“PSD2”). Together, the proposals strengthen fraud protections, increase transparency in fee disclosures for payments and currency conversions, and expand competition by improving access to payment account data for licensed open banking providers.

The proposals would introduce several changes to the EU payments framework. ATM providers would be required to disclose all applicable fees and currency conversion charges before a transaction occurs. Merchants would also be required to ensure that the name appearing on a customer’s bank statement corresponds to the merchant’s trading name to make charges easier to identify. In addition, the legislation would restrict account servicing payment service providers from imposing obstacles that limit licensed third-party access to payment account data. Although a political agreement has been reached, the texts must still undergo technical finalization before formal adoption by the European Parliament and the Council and publication in the Official Journal of the European Union.

Last Updated 11/27/2025.