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Final texts for PSD3 and PSR awaited as European Parliament and Council of EU announce provisional political agreement

15 December 2025

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On 27 November 2025, the European Parliament and the Council of the EU announced that they have reached a provisional political agreement on the texts of the proposed Directive on payment services and electronic money services (PSD3) and Regulation on payment services in the EU (PSR). Subject to completion of work on the technical elements of the payments package, payment service providers (PSPs) should expect to see the final texts in the coming weeks.

On 27 November 2025, the European Parliament and the Council of the EU issued press releases announcing that they have reached a provisional political agreement on the PSD3 and PSR proposals originally published by the European Commission in June 2023. As we previously indicated, there is clearly strong appetite to get both files concluded under the Danish Presidency which concludes at the end of the year.

Both press releases highlight some familiar focus areas including:

Tackling payment fraud: Among other things, the final proposals will provide that major online platforms and search engines may only advertise financial services to consumers in a member state if the company providing those services is authorised (or exempt) within that member state. Online platforms will also be liable to PSPs who have reimbursed defrauded customers if they are informed of fraudulent content on their platform and fail to remove it. In addition, it appears that the Parliament’s attempted extension of PSP liability for impersonation fraud beyond fraudsters impersonating an employee of the PSP to ‘any other relevant entity of public or private nature’ will not be included in the final text.
Increased transparency on fees and charges: This will include a requirement on ATM providers to show the user all fees due and exchange rates applied before a transaction can take place. Merchants will also have to ensure that their normal trading name matches the name that appears on customers’ bank statements so that they can easily recognise charges.
Improved competition: The new legislation will aim to reduce market barriers for “open banking services” (account information and payment initiation services) and prevent account servicing payment service providers from discriminating against them. This includes a requirement for authorised open banking providers to be able to access payment account data, and there will be a list of prohibited obstacles to data access. Additionally, manufacturers of mobile devices and electronic service providers will have to allow front-end service providers (eg apps or user interfaces) to store and transfer the data needed to process payments on fair, reasonable, and non-discriminatory terms.
Simplified authorisation: This will include provision for cryptoasset service providers (CASPs) already authorised under MiCA to be subject to a streamlined authorisation procedure.

In addition, we understand that:

surcharging on non-consumer cards would continue to be permitted; and
the provisions relating to e-money tokens will be a particular focus for the technical teams who are currently working through the technical amendments to the texts.

What’s next?

We await publication of the final PSD3 and PSR texts in the coming weeks for the details of what’s changed as a result of the inter-institutional (trilogue) negotiations.

Whilst a political agreement has been reached, there are a number of matters which need to be ironed out during the technical trilogues. The technical trilogues are already under way and we expect the final texts to be published soon and to be sent to the Committee of Permanent Representativies (COREPER). The Danish Presidency are keen for this to be concluded under their Presidency (which ends on 31 December 2025) and COREPER endorsement marks the effective conclusion of the file.

After COREPER endorses the file, there are still a few more steps. The texts will be sent back to the Council and the Parliament for approval. In the Council this usually requires a qualified majority and, in the Parliament, this will include the text being approved in the Economic and Monetary Affairs Committee (ECON) before being sent to Plenary - both by simple majority. Only once the texts have been passed by both houses will the new legislation be entered into the Official Journal and come into force.

There is nothing in the Parliament or Council press releases to confirm the final position on the implementation period. What we know so far is that there is an 18-month implementation period (although the Council proposed to extend this to 24 months). Subject to the final texts, this means that the earliest PSD3/PSR is likely to become applicable is H2 of 2027, although this could move into early 2028 if the Council has been successful in extending the implementation period.

Meanwhile, PSPs can get up to speed by taking a look at our PSD3 Impacts Report. Updated in September this year to incorporate the Council’s June 2025 amended PSD3 and PSR texts, the Report summarises the impact of the PSD3 and PSR legislative proposals thematically, highlighting areas where the EU trilogue process might have shifted the dial further before the texts are finalised, and flagging where changes might need to be reflected in PSPs’ businesses.

We have extensive experience of advising on regulatory change projects, including the previous significant overhaul of the EU payments regulatory landscape under PSD2.

If you have any questions on how PSD3/PSR might affect your business, please get in touch with one of the listed people or your usual Hogan Lovells contact.

Authored by Charles Elliott, Lavan Thasarathakumar, and Virginia Montgomery.