Commissioned by ForgeRock

1 Executive Summary

In the European Union, the Revised Payment Services Directive (PSD2) will radically alter the financial services landscape. It has already begun to cr ...

2 Highlights

• EU PSD2 took effect in January 2018. The Regulatory Technical Specifications (RTS) govern the implementation of Strong Customer Authentication (SCA ...

3 PSD2: The background and Regulatory Technical Specifications

PSD2 will revolutionize payments and financial services across the EU. PSD2 aims to foster competition in the financial sector, increase transactional ...

3.1 Background and goals of PSD2

The original PSD helped establish the Single Euro Payments Area (SEPA), facilitated cross-border payments, cut fees and increased choices for consumer ...

3.2 Strong Customer Authentication

Clients of financial services must use strong authentication methods to access financial resources. As written, PSD2 defines strong authentication in ...

3.3 Market changes and risks

Banks will still hold money and make loans, but new companies are emerging that will also provide services to handle account aggregation and payment m ...

4 Technical capabilites for PSD2 RTS architecture

Complying with PSD2’s regulatory technical specifications almost certainly means building new capabilities, functions, and features. Correspondingly ...

4.1 SCA and Transaction Risk Analysis

Many CIAM and IAM solutions on the market today support the concept of SCA. Companies that have to comply with PSD2’s SCA provisions must decide whe ...

4.2 CIAM

In order to offer SCA, a proper Identity and Access Management (IAM) solution is needed. Traditional IAM systems are designed to provision, authentica ...

5 What you need from IAM systems for PSD2

In chapter 4 we see that, at a high level, banks and financial institutions need CIAM solutions with risk adaptive authentication mechanisms to achiev ...

6 ForgeRock Identity Platform as a foundation for PSD2 compliant architectures

ForgeRock Identity Platform can provide CIAM, SCA, and risk-adaptive multi-factor authentication functionality that directly address the technical req ...

6.1 ForgeRock Intelligent Authentication for SCA and transactional risk analysis

ForgeRock Access Management, as a component of the ForgeRock Identity Platform, performs the authentication and authorization functions. It supports m ...

6.2 ForgeRock IDM for CIAM

ForgeRock’s Identity Management module provides a rich set of features for CIAM. Users can self-register and manage their accounts, including consen ...

7 Recommendations

PSD2 is fast approaching, and the RTS will require major technology insertions for many banks and TPPs. IAM/CIAM infrastructure may need to be upgrade ...

7.1 Recommendations for conducting a PSD2 Readiness Assessment

• Inventory existing IAM and risk management infrastructure: Can it offer strong customer authentication? Does it have sufficiently advanced risk anal ...

7.2 Recommendations for meeting PSD2's SCA Requirements

• Utilize risk adaptive authentication for transactions that fall under the purview of SCA. Use ongoing transactional risk analysis to reduce the need ...

8 Related Research

Leadership Compass: Access Management and Federation - 71102