The EU directive governing payment services and open banking, which intersects with eIDAS 2.0 through strong customer authentication requirements and the potential use of the EUDIW for payment initiation.
PSD2 (Payment Services Directive 2, Directive (EU) 2015/2366) is the European Union's regulatory framework for payment services, designed to increase competition, innovation, and security in the payments market. PSD2 introduced strong customer authentication (SCA) requirements, mandating that payment service providers verify customer identity using at least two of three factors: knowledge (something the user knows), possession (something the user has), and inherence (something the user is). PSD2 also opened the door to open banking by requiring banks to provide third-party access to customer account data through secure APIs.
The intersection between PSD2 and eIDAS 2.0 is significant and growing. The EUDIW, as a government-backed, high-assurance identity instrument, is well positioned to serve as an authentication mechanism that satisfies PSD2's SCA requirements.
Several Large-Scale Pilots, notably NOBID, are explicitly testing the use of the wallet for payment-related use cases, including account opening and payment initiation. Under eIDAS 2.0, financial institutions performing customer due diligence under anti-money laundering regulations will be required to accept the EUDIW for identity verification, creating a direct link between the wallet and PSD2-regulated activities.
Furthermore, the wallet could streamline know-your-customer (KYC) processes by providing verified Person Identification Data directly from government-issued credentials, reducing the friction and cost of onboarding new banking customers. For financial services organisations, the convergence of PSD2 and eIDAS 2.0 means that wallet integration planning should be part of their broader payments and compliance strategy, not treated as a separate workstream.
Related Terms
eIDAS 2.0
The revised EU regulation on electronic identification and trust services, updating the original 2014 eIDAS framework to mandate a European Digital Identity Wallet for all EU citizens.
Core RegulationEuropean Digital Identity Wallet (EUDIW)
A mobile application that every EU Member State must provide to citizens and residents, enabling them to store and present digital identity credentials and attestations across borders.
Digital IdentityRelying Party
An entity, public or private, that relies on the EUDIW or electronic identification means to verify the identity or attributes of a user for the purpose of providing a service.
Core RegulationAnti-Money Laundering Authority (AMLA)
The new EU authority responsible for overseeing anti-money laundering compliance, whose requirements for customer identity verification intersect directly with eIDAS 2.0 wallet acceptance obligations.
Core Regulation