How does SCA work with Open Banking payments?


  • EBA opinion requires banks to support “frictionless” consumer authentication
  • Payment solution vendors must use 2FA biometrics
  • EBA opinion enables merchants to provide better payment experiences


Part of the PSD2 legislation sets guidelines for strong customer authentication (SCA). In June 2020, the European Banking Authority issued an opinion on the provision of third party provider services (TPPs) under PSD2.

Today, banks in markets such as Sweden and the UK have built solid APIs, while in other markets, some banking APIs do not deliver a simple user experience when it comes to authentication for Open Banking payments. To remedy this, EBA guidelines state that the checkout process “cannot have unnecessary steps or friction”.

These rules will help third party Open Banking payment vendors leverage simpler authentication flows. Users won’t be subjected to redirects or be shown unnecessary confirmation or warning messages.

Additionally, banks must allow TPPs to use fingerprint and face-scan biometric-supported apps for authentication purposes. This removes huge barriers for merchants who want to offer their customers a frictionless buying experience.

FAQ: Cross-border payments and Open Banking


Why are online cross-border purchases increasing in the EU?

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What makes online cross-border payments so complicated?

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What are Open Banking payments?

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How does an Open Banking payment flow work, in general?

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Do European banks have to facilitate Open Banking payments?

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How does SCA work with Open Banking payments?

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How do Open Banking payments work across borders?

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How can cross-border expansion be simplified for merchants?

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Are Open Banking payments popular with consumers?

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Why do consumers like Open Banking payments?

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How can Open Banking payments speed up cross-border settlement?

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How do cross-border Open Banking refunds work?

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How can you choose the right Open Banking payments provider?

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