(7 August 2019 – United Kingdom) The UK’s Financial Conduct Authority is set to delay enforcement of new EU online payments regulations by more than 18 months, after warnings that the rules would hamstring online sales.
New “strong customer authentication” rules, which will require most online payments to go through an extra level of verification to reduce fraud, are due to be introduced in September, but industry groups said that a lack of preparedness would make more than a quarter of payments impossible to complete.
In an update in June, the European Banking Authority rejected calls for a continent-wide grace period, arguing that companies had more than three years to prepare.
But critics of the rules said certain key technical details were not confirmed until this year, and companies have turned to national regulators to plead for more time.
The FCA asked the trade group UK Finance to design an alternative timetable for the UK. Its final recommendations, which were agreed with major financial, retail and travel groups, were submitted to the regulator last Friday.
The report, which has been seen by the Financial Times, said companies should have until March 2021 to implement most of the technical requirements, and a further six months to implement a more advanced form of authentication. Companies in the hospitality and travel sector would receive an additional year to prepare because of the “incredibly complex” nature of their payment systems.