Global Payments & Fintech Trends: focus on fraud, PSR & VOP
The Paypers just released the 2025 edition of its Global Payments and Fintech Trends Report, which provides insights into the latest technologies and developments in the financial sector and features several renowned experts. In his article, Emanuel van Praag (Attorney-at-law and professor of Fintech and Law at Erasmus School of Law, in Rotterdam) dives into the European payments landscape and explores trends, risks and the EU’s legislative responses.
As explained by Emanuel van Praag, “the European payments landscape is undergoing a profound transformation, shaped by technological advancements, evolving consumer behaviors, and new legislative measures aimed at improving both efficiency and inclusion”. The expert first focused on global payment trends and risks (such as the declining use, acceptance and availability of cash, the digitization of bank branches, geopolitical tensions, etc.) before diving into the following key points and aspects:
PROTECTING VULNERABLE CONSUMERS
→ The Accessibility Act and the proposed PSR (Payment Services Regulation): The EU’s Accessibility Act makes payments more accessible for consumers who are more vulnerable (for instance, with the introduction of text-to-speech technologies, devices understandable at an upper-intermediate language proficiency level, etc.). M. van Praag adds: “Similar provisions are included in PSR, which, along with the PSD3 directive, forms a cohesive legislative package. Under PSD2, Strong Customer Authentication (SCA) was introduced, and the PSR mandates PSPs to ensure SCA methods are accessible to people with disabilities, the elderly, and those with limited digital skills or access. Compliance with these rules requires significant investment from PSPs and adherence to deadlines, with the risk of reputational damage if measures are not properly implemented, as they are aimed at protecting vulnerable members of society”.
→ Combating payment fraud: PSR introduces new measures to fight fraud, and also to allocate risks if fraud actually occurs. They main provisions are:
- Conditional reversal of liability for Authorized Push Payment fraud: APP fraud occurs when a victim authorizes a payment based on fraudulent grounds (e.g. social engineering, impersonation, etc.). For instance, in case of bank impersonation fraud, PSPs will have to refund the victim, except for client fraud or gross negligence cases.
- Extension of IBAN verification: PSR proposes to extend IBAN verification to all types of credit transfers. PSPs would therefore be obliged to verify that the payee’s name and his/her bank account number match. Such an obligation, the Verification of Payee, has already been introduced in IPR (Instant Payments Regulation) and enters into application on October 9th, 2025.
- Improved fraud monitoring: PSPs will have to implement transaction monitoring systems in order to detect fraud/fraudulent activities. Balance is key, and as explained by the expert, “too lax monitoring can result in liability, while overly stringent monitoring can lead to false positives and privacy concerns”.
ALTERNATIVE PAYMENT RAILS
Alternative payment systems are/will be arriving and aim at breaking the dominance of US-owned card networks such as Mastercard and Visa.
→ IPR: by October 2025, PSPs will be required to complete instant payments in euros within 10 seconds across the EU, 24/7 (some minor exceptions apply). The regulation makes IPs a low-cost, direct payment method in the EU, and therefore competes with credit card giants. As highlighted by the expert, “the goal is to reduce reliance on US-owned card schemes, enhance competition, and improve services, while reinforcing the EU’s strategic autonomy”.
→ European Payments Initiative (EPI): this initiative, launched by 14 major banks in Europe, aims to upgrade cross-border payments by adding a layer on top of SEPA instant payments, such as a QR code to trigger payments in the payer’s bank app. This solution is named WERO.
→ Open Banking and the SPAA Scheme: the SEPA Payment Account Access Scheme was developed to ensure confirmation that (Open Banking) payments initiated by PISPs from a user’s account at another PSP will be indeed executed, confirming that sufficient funds are available, and that the payment will not be blocked because of suspected fraud.
Emmanuel van Praag concludes: “As liability shifts from consumers to PSPs, service costs are likely to rise, and upgraded fraud monitoring systems will be required, while balancing privacy concerns.”