The second Payment Services Directive (PSD2): what Breathe customers need to know

On 14th September 2019, there’ll be some changes to how online payments are authenticated. These changes have come in as part of what’s known as PSD2 (second Payment Services Directive).

While (unfortunately) we can’t be sure of how far the new regulation will affect consumers, we want to ensure you as our customer know what to expect when the September date arrives and are fully prepared.

In this document we’ll take a look at what PDS2 is, what the new requirements are, what you need to know and - most importantly - how it could affect you as a Breathe customer.

This is the second phase of what’s known as the ‘Payment Services Directive’ (PSD), which was set up by the European Union (EU) back in 2007 to regulate payment services and their providers. 

This may sound a bit technical and intimidating - but bear with us on this one.

Let’s look at what this means and how it may affect consumers.

In a nutshell, Strong Customer Authentication (SCA) is a new requirement to regulate online payments, make them more secure and reduce fraud. So, all good and reassuring stuff here.

At the moment, online payments are authenticated by a system called 3D Secure -an extra security step after you put your card details in. You may have noticed that you’re often required to supply additional information – e.g. characters from your online banking password or a one-time-code sent to your phone.

But, from the 14th September when SCA is required, you might notice that when you make an online payment using a credit card, there are 2 authentication steps in the checkout process instead of 1. This is because 3D Secure is being upgraded to 3D Secure 2 – a new version that’s being introduced to meet the new security requirements of SCA.

As we previously mentioned, we can’t be sure how often this will be required for consumers - it’s solely your bank’s decision as to whether SCA is required for a particular transaction. 

However, if SCA is required for an online card payment, it will involve two of the following three factors:

So, for example, your mobile phone may ask for your fingerprint as well as a one-time-code being sent to your mobile number. 

You’ll then have 21 days to authorise the payment. If these 21 days run out and these things haven’t been supplied, the bank is then likely to decline the payment.

So, what does this mean for you? Let’s run through the possible implications of the new SCA regulations if you’re already one of our customers.

Do you pay via credit card?

If you’re one of our many customers who choose to pay by credit card, it’ll mean that each time a payment is taken you may be required to authorise it via two different methods.

As we mentioned earlier, it’s up to your bank to decide whether or not you’re asked for a secondary authorisation. You may not be asked every time. 

Do you pay monthly?

If you choose to pay monthly rather than annually, your bank may ask you to authorise each monthly payment via two different methods.

Recurring card payments usually happen overnight, so you could potentially be asked at a rather inconvenient hour for your fingerprint and card details. 

But, as long as you authorise the payment within 21 days, the payment to us will go through successfully and you’ll have nothing to worry about.

Do you use your boss’ credit card?

If you don’t have your own company credit card and you use a managers’ card, you may not be able to authorise the payment yourself if SCA is requested. Due to the personalised authorisation methods, you’d need the cardholder themselves to do it.

As mentioned previously, it’s important you make sure you carry out the 2-factor authorisation process within 21 days of it being requested. 

If the payment is declined by the bank, we’ll regrettably have to suspend your Breathe account (and we really don’t want to do that).

If you’re currently paying monthly, you might consider switching to an annual plan (this would make things a lot easier in terms of billing).

Switching is incredibly simple – your admin user just needs to go to their Breathe account and head over to the billing area.Even better new, annual plans will benefit from a 10% annual discount on the plan price, The 10% discount will be applied automatically. 

Need a hand? check out this useful support article which guides you through how to switch to an annual plan.
​
​