SCA expected to get 18 month delay
Written by Peter Walker
The Financial Conduct Authority (FCA) is set to delay enforcement of the Strong Customer Authentication (SCA) payment security rules by than 18 months, on the recommendation of UK Finance.
This is according to reports in the Financial Times, which reported that as part of its consideration of an extension to the 14 September deadline for implementing the second Payment Services Directive (PSD2), the regulator asked the trade association to design an alternative timetable for the UK.
Final recommendations, which were agreed with the financial, retail and travel groups most impacted by the new rules, were submitted last Friday.
UK Finance is apparently recommending a minimum 18-month delay, with a further one-year extension for the hospitality and travel sector.
Taking its lead from a European Banking Authority (EBA) statement in June which allowed national authorities to “provide limited additional time”, the FCA confirmed a delay to the enforcement of stronger payment security standards to give firms more time to prepare.
The SCA rules require a two-step verification process for all online purchases over £30 most to help reduce fraud, but payments providers and e-commerce merchants have warned that a lack of industry preparedness would make more than a quarter of payments impossible to complete.
UK Finance is expected to officially present its recommendations to the FCA next week. They call for a revised March 2021 deadline to implement most of the technical requirements, and a further six months for a full-scale roll out.
Discussions are believed to be ongoing among national policy makers over the possibility of co-ordinating the new timetable on a cross-border basis.
UK Finance and the FCA declined to comment.