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As Europe modernizes its payments rulebook, the EU Payment Services Directive 3 (PSD3) and the Payment Services Regulation (PSR) are set to reshape expectations for payment service providers in terms of compliance, fraud accountability, transparency, and customer trust. For merchant-facing PSPs, gateways, and payment institutions, the message is clear: readiness isn’t a legal checkbox. It’s an operational program that touches product design, risk controls, merchant experience, and customer support.
This matters because PSD3/PSR is arriving at a time when fraud tactics are industrialising through automation, social engineering, and increasingly AI-enabled tooling, while payment choices (cards, wallets, pay-by-bank, and instant payments) keep expanding. Regulators are effectively asking PSPs to prove two things:
- Prevent and detect fraud more effectively
- Communicate and support customers more transparently when things go wrong
Europe’s “payments package” includes PSD3 and PSR. In simple terms:
PSD3 is a directive that governs who can operate in payments, covering licensing, supervision, and prudential rules for payment and e‑money institutions and is implemented via national law.
PSR is a directly applicable regulation that governs how payments work, day to day, including fraud prevention, strong customer authentication, transparency, and open‑banking access, creating a single harmonized EU rulebook. Together, they aim to reduce fraud, strengthen consumer protection, and level the playing field between banks and fintechs.
- PSD3 updates the broader payments framework (including authorization and supervision) and, as a Directive, will be transposed into national law by Member States, likely by late 2027 or early 2028.
- PSR, as a Regulation, is designed to apply more uniformly across the EU, reducing divergence in operational and consumer-protection rules. PSR is currently in the final stages of the legislative process, expected to be published mid-2026.
Below is a practical readiness view for PSPs to help operationalize the changes and explore how modern payments and fraud platforms can help.
Compliance-critical actions for PSPs
Uplift your fraud framework with stronger prevention, information-sharing, and accountability
PSD3 signals firmer expectations around fraud-related information sharing and introduces liability pressure where preventive tools aren’t fulfilled. For PSPs, this turns fraud prevention into a board-level operational requirement rather than a nice-to-have.
What this means operationally:
- Treat fraud controls as policy, platform, and process; not just rules
- Ensure you can evidence what controls were applied, when, and why (auditability)
- Build workflows that support case management, internal escalation, and consistent handling
PSPs that win in the PSD3/PSR era will move from fraud “screening” to real-time fraud operations using adaptive models, orchestration, and explainability that can support both risk outcomes and regulatory scrutiny.
Tactics PSPs should employ:
- Real-time fraud decisioning using machine learning, behavioural signals, and adaptive strategies
- Operational case workflows for investigation, evidence capture, and consistent outcomes
- Leverage network intelligence to identify emerging patterns earlier
Support Confirmation of Payee (IBAN-name checks) for account-to-account flows
The agreement requires IBAN-name checks before transfers, often framed as Confirmation of Payee (CoP). PSPs enabling pay-by-bank initiation or processing need to integrate name-check outputs into customer journeys, including error handling and user controls.
What this means operationally:
- Embed CoP results into UX flows; what happens when it matches, partially matches, or fails
- Build exception handling: fallbacks, step-up verification, and user messaging
- Implement monitoring: track mismatch rates, false positives, and customer friction
CoP is not only a compliance item but is a trust control for account-to-account payments. Done well, it can reduce automated push payment (APP) and scam losses while keeping conversion high.
Tactics PSPs should employ:
- Payments orchestration to manage bank connections and real-time status updates for pay-by-bank
- Fraud/scam detection to identify anomalous payee changes, mule patterns, and scam typologies
- Rules leveraged through machine learning to apply proportionate friction; step-up only when risk is high
Provide clear fee transparency to merchants, especially card payment facilities
Providers of card payment facilities must clearly show the fees they charge merchants. For PSPs, this is rarely “just a legal line item”; it’s a product requirement spanning statements, dashboards, reporting taxonomy, and how fees are explained across channels.
What this means operationally:
- Create a consistent fee taxonomy across contracts, portals, statements, and support scripts
- Make fees understandable: what, why, when applied, and how calculated
- Ensure data can be reconciled and exported for merchant finance teams
Transparency becomes a competitive edge when you turn it into merchant self-serve insight.
Tactics PSPs should employ:
- Real-time fee calculation and display (where your platform supports it)
- Reporting/dashboards that align charges, payment methods, and risk outcomes
- Portal experiences that reduce disputes and inbound support volumes
Ensure recognizable merchant descriptor handling to reduce confusion & disputes
Recognizable statement naming is tied to reducing customer confusion, disputes, and avoidable chargebacks. PSPs that onboard merchants must capture, validate, and propagate the right trading names and ensure consistent representation across systems.
What this means operationally:
- Validate descriptor inputs at onboarding and revalidate changes
- Ensure propagation through routing, reconciliation, and statement rendering
- Link descriptor integrity to chargeback reduction and customer support efficiency
Recognizable descriptor handling is a low cost way to reduce “friendly fraud” and dispute volumes and is increasingly part of the broader trust agenda.
Tactics PSPs should employ:
- Workflow support for merchant onboarding and change management
- Reporting that correlates descriptor issues with disputes, refunds, and chargebacks
- Fraud/dispute insight that reduces preventable operational cost
Provide access to human support, not chatbot only, for payment issues
Commentary highlights expectations that customers can access human customer support, not solely chatbot-based assistance. For PSPs, this affects operating model design: escalation paths, response SLAs, and cross-team tooling.
What this means operationally:
- Define escalation routes and staffing models, including peak scenarios
- Equip agents with the right tools: payment traceability, decision explanations, and evidence packs
- Reduce avoidable contacts by improving proactive alerts and self-serve resolution
Support readiness is part of “operational resilience,” and this protects trust when fraud, outages, or disputes hit.
Tactics PSPs should employ:
- Unified visibility into transaction status and decisioning
- Case workflow tooling to reduce mean-time-to-resolution
- Proactive alerts that deflect inbound volume
Best practices to cut cost and win share aligned to PSD3/PSR expectations
Invest in real-time, adaptive fraud monitoring, and case workflows
Given the liability direction and increased scrutiny, PSPs benefit from moving beyond static rules into adaptive, real-time systems that can respond to new fraud patterns quickly.
Readiness moves:
- Layer machine learning, rules, and behavioral analytics with step-up controls
- Implement investigation workflows and evidence capture
- Measure impact in business KPIs: approval rate, chargebacks, false positives, and ops cost
Best-in-class fraud prevention becomes both risk mitigation and merchant value when integrated into checkout and operations.
Improve open banking connectivity and consent handling where relevant
For PSPs offering Payment Initiation Service Provider (PISP)/Account Information Service Provider (AISP) services (or planning to), resilience depends on reliable connectivity, permission management, and consent UX that doesn’t introduce friction or operational risk.
Readiness moves:
- Harden API reliability and monitoring
- Treat consent as a lifecycle: capture, refresh, revoke, audit
- Align consent UX with fraud controls and step-up authentication
Orchestration capabilities can help manage bank connections, real-time updates, and consent flows consistently across markets.
Build merchant education and comms tooling: Dashboards, alerts, dispute packs
PSPs can reduce inbound load and increase trust by giving merchants proactive visibility into what’s changing, what’s required, and how it impacts their customers.
Readiness moves:
- Create “PSD3/PSR readiness” merchant hubs: checklists, FAQs, fee explainers
- Push alerts for risk events and operational incidents
- Provide dispute/fraud evidence packs with consistent terminology
PSP dashboards and compliance reporting aren’t just internal tools; they can become merchant-facing trust products.
Strategic opportunities that extend value beyond regulatory compliance
Package “PSD3/PSR-ready” merchant propositions
Create GTM bundles: transparent pricing dashboards, pay-by-bank with CoP scam controls, dispute tooling, positioned as trust enablement.
Launch value-added services using transparency and fraud tooling
Turn compliance-driven capabilities into revenue: premium analytics, risk advisory, benchmarking, fee optimization insights, and fraud performance reporting.
Thought leadership and co-marketing on safer pay-by-bank and trust
Educate the market: “What CoP means for conversion,” “How to reduce APP scams,” and “How transparency reduces disputes.”
Conclusion
Ultimately, PSD3 and PSR reward PSPs that treat compliance as an operational capability rather than a bolt‑on obligation. Platforms that unify real‑time payments, fraud prevention, case management, transparency, and customer support are better placed to evidence controls, reduce losses, and protect trust, without adding friction for merchants or consumers.
This is where ACI supports PSPs: helping them orchestrate payments and risk in real time, operationalize fraud accountability, and turn regulatory readiness into a foundation for safer growth. Not just to meet the letter of PSD3/PSR but to compete more effectively in a faster, more complex payments landscape.
ACI’s whitelabeled payments orchestration platform helps PSPs maximize revenue, add new capabilities, and expand into new markets by unifying payments, fraud prevention, and risk operations without processor tie‑in or integration bottlenecks.
ACI Fraud Management for Merchants 
Salvatore Perrotta is a Senior Payments Solution Consultant at ACI Worldwide specializing in payments, fraud prevention, and payments orchestration. With more than a decade of experience in the payments industry, he supports PSPs and merchants in navigating increasingly complex payment environments, balancing regulatory compliance with commercial performance. Salvatore works closely with financial institutions and payment service providers to design secure, scalable payment strategies that align with evolving regulatory requirements while improving customer experience and operational efficiency.
