In 2024, the banking sector underwent numerous regulatory changes, one of the most significant being perhaps the PSD3/PSR (Payment Services Regulation), which, after lengthy preparation, defines all payment transaction regulations not in a directive but in a regulation. There is currently no set timeline for the introduction of PSD3, but the final versions may be available to everyone by the end of the year. EU member states will be given 2 years to integrate the new regulations, so the PSR could come into effect in 2026.
Why is the PSR an important step forward?
As a result of explosive technological advancements, financial transfers now offer new and simpler solutions for both payment service providers and everyday people, but unfortunately, also for fraudsters.
The PSR enables organizations to share fraud-related information with each other, thereby improving the flow of targeted information to customers and enhancing consumer awareness. It tightens the customer authentication regulations, providing a safety net for consumers who fall victim to fraud, particularly by reinforcing their rights to refunds. Thanks to the new system, consumer protection improves, for example, in cases of temporary account blocks, as well as in the transparency of account statements.
The rules of strong customer authentication will be stricter and it will become mandatory to check the name and IBAN number of the beneficiary’s account holder for transfers.
Babel Street Precognox – partners in name identification
The PSR presents new challenges regarding account access, strong customer authentication, fraud protection, security measures, IBAN verification, and the management of consents. At Precognox, we offer a solution for account holder name matching, which will soon become mandatory for all bank transfers within the EU.
Egyik legfontosabb partnerünk, a Babel Street, RNI (Rosette Name Indexer) megoldása segít ebben bennünket, amely a MI alapú nagyon fejlett névkeresést és névegyeztetést tesz lehetővé magánszemélyektől kezdve egészen helyszínekig, szervezetekig.
The RNI provides high-speed, scalable search capabilities across multiple languages and writing systems. Recognized as one of the best solutions in the world, it is now used by numerous banks and organizations, including U.S. and U.K. border control, to compare names and company names.
AI for customer protection
By now, it has become essential for many financial institutions to integrate tools and technologies into their existing systems that employ advanced name identification, even if these solutions can sometimes disrupt smooth workflows.
At Precognox and Babel Street, we are working on AI-based solutions that speed up and improve the efficiency of identity verification processes. Our advanced, integrable system provides an opportunity for domestic players who need to comply with the PSR regulations by the set deadline of 2026. These products are indispensable for organizations that rely on accurate name matching across multiple languages and writing systems.
