The new regulatory framework for marketplaces
29 July 2016
Marketplaces have become key players in e-commerce: wide choice of multi-brand products, competitive prices… A short reminder of the essential information and the next legal framework that will surround the online payment of Marketplaces.
A sales model in full boom
The Marketplace is a platform for sales, services or announcements. Its objective: to put a buyer and a seller in contact by generally playing the role of payment intermediary (eBay, Cdiscount, PriceMinister…). Customers benefit from a “one-stop-shop”, i.e. the same place to make all their purchases.
A very popular sales model since 95% of Internet users would have already used Marketplaces to buy an item (source: Mirakl/Sorgem/IBM barometer) and in 2015, 8% of online sales will have gone through similar platforms (source: Fevad barometer). As an example, Amazon hosts on its Marketplace more than 2 million merchant partners who generate the sale of more than 2 billion items!
DSP2: a legal framework for online payment
Every month, 2 to 4 Marketplaces are created. Against this backdrop of euphoric growth, the European authorities decided to define a precise regulatory framework to regulate the activities of marketplaces: the PSD 1 (Payment Services Directive) was then put in place. It allows new “payment institutions” to provide payment services on the same basis as banks and to harmonise the European market with a common legal and statutory framework.
Its little sister, DSP 2, which is scheduled for deployment in France at the end of 2017, aims to facilitate the use of online and mobile payments by making them less costly and more secure. Reinforced authentication of the online payer is one of the flagship measures, which PSD 2 will generalise (unless specific derogations are made).
These new rules are also beneficial for consumers, who will benefit from better protection and innovation in the field of payments (clearer payment information, faster payments, refund rights – unauthorised debits, overcharging, incorrect processing – and increased competition).
What changes are introduced by the new PSD 2 rules? The French regulator (ACPR) answers
- The introduction of strict security requirements for the initiation and processing of electronic payments and the protection of consumers’ financial data;
- The opening of the EU payments market to businesses that offer payment services to consumers or businesses based on access to payment account data, namely “payment initiation service providers” and “account information service providers”;
- The strengthening of consumer rights in many areas, including the reduction of liability for unauthorised payments, which introduces an unconditional (“no questions asked”) right of refund for direct debits in euro;
- Prohibition of surcharges (e.g. additional fees for card payments), whether the payment instrument is used in shops or online.
The role of payment institutions
A company operating a market place is considered to be a payment service provider. It provides its member merchants with two types of services: the acquisition of payment orders and the execution of transfer orders associated with a payment account.
The holding of funds on behalf of merchants is referred to as “third-party collection”. It involves the creation of a payment account (electronic wallet).
Unless it is accredited by the ACPR (Autorité de Contrôle Prudentiel et de Résolution), in order to become a payment institution (PI) or an electronic money institution (EMI), the marketplace must rely on an approved payment company, such as Treezor, to manage all incoming and outgoing flows.
The main services provided by Treezor as an EME and payment service
- Acquisition of flows: credit card, bank transfer, direct debit
- Creation of wallet and cantonment of funds
- KYC management (verify customer identity)
- Fraud and money laundering risk management
- Management of transfers, transfers and refunds of funds
The payment solution selected to equip your Marketplace will be in charge of numerous services to ensure the transparency and security of transactions, but also guarantee a high level of consumer protection.
The reference solutions for Marketplaces
Want to create a marketplace? Need an efficient online payment solution? Discover companies that can propel your business.
- Mirakl is a leading French software publisher offering the SaaS (software as a service) solution to quickly create and launch a Marketplace. The company harmonizes with simplicity the whole chain (management of your content, Back and Front Office…) thanks to its programming interface (API). In addition, it relies on numerous partner solutions to complete its range of services.
- Lengow is a solution in SaaS mode that allows e-merchants to manage the distribution of their product catalogs on the web (merchant sites, marketplaces…).
- Treezor is a Fintech that acts as an Electronic Currency Issuer. It offers a complete payment solution for crowdfunding platforms and marketplaces. The company takes care of managing the flows circulating on your electronic purses. Another advantage is that Treezor covers all the necessary regulatory obligations in terms of third-party collection, risk management and fund guarantee.