The Berlin Group, an independent body for establishing payment standardisation, has announced the development of a standard for application programming interfaces (APIs), for use under the upcoming revised Payment Services Directive (PSD2). PSD2, due to be introduced in January 2018, will allow authorised third party providers (TPPs) to access the account data of bank customers through APIs. However, PSD2 doesn't set out a standard for these APIs. The Berlin Group's NextGenPSD2 Taskforce has now come up with a proposal for an open, common, harmonised API standard. The proposed standard is still under development and there will be a consultation period in the fourth quarter of 2017.

The group says its objectives are to:

• reduce the complexity of PSD2 Access to Accounts (XS2A);
• address the problem of multiple competing standards; and
• ensure maximum interoperability and reachability across Europe by specifying a harmonised and interoperable API standard for a European XS2A Interface between banks and TPPs.

It stated: “This would enable European banking customers to benefit from innovative products and services by granting TPPs safe and secure access to their bank accounts and financial data, accompanied by a frictionless customer experience.”

The Berlin Group is a pan-European technical standardisation body for payments, whose primary objective is to define open and common standards in the interbanking domain, independently of any payments scheme or processor. The group began life as part of the SEPA project in 2004 and its members include banks, banking associations, payment associations, national and international payment schemes and interbank processors.

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CTMfile take: Establishing an API standard is a key step towards having access to accounts (XS2A) that works under PSD2. The initiative is already beset with friction as banks and fintechs argue about access to bank customer data. Bringing some clarity and standardisation to the process will be essential.