April 19, 2019 | AtoZ Markets - The Forex payment sector may soon witness a radical change in its base and mechanism, reports unveil.
The news comes after an industry lobby group for the payments service sector, founded by fintech firms showed its will to make the revolutionary change, as the media described.
forex’ nature today, being done more online, imposes the need of better quality merchant services for the retail financial product range.
Another points to consider here, is the lack of discussion and opinion exchange among the professionals in the forex and CFD business field, while it said, on the other hand, that small to medium-sized retail brokerages are known of their bad reputation, were a piece of news described them as “pyramid marketers, money launderers and former binary options salesmen.”
Big names like MasterCard and Visa, as merchant services providers, took part in a way or another in dying the forex sector in the negative colour it mostly has today, due to their foggy stance about the retail brokerage.
Banks, on their turn, pushed as well toward consolidating that down reputation the forex sector has been known of, as they reject deposit accounts for such kind of transactions.
As a result, forex brokers find themselves obliged to compromise their chances as they resort to banks classified as “third-class” in countries like Eastern Europe and CIS, according to a report published on cryptovibes.com, and with those banks having not top-notch security services, those brokers are therefore at risk.
Non-profit TPP trade association eleminates the problems
Fintech companies have now created a non-profit organisation that will act on behalf of the third parties on the issues of the Second Payment Service Directive (PSD2) that affect the forex market.
The Future of European Fintech coalition is an official non-profit TPP trade association now, in partnership with Eurobits, Sofort, Bankin’, Trustly and PPRO as founding members.
Fintech firms have concerns that the existing customer authentication method, along with the communication way, were designed to benefit traditional banks. However, the new entity will work on pushing the interests of “bank-independent third-party providers”, as the PPRO’s executive advisor Ralf Ohlhausen explained, adding: “We are delighted to strengthen our position with the launch of the ETPPA, and we encourage all bank-independent TPPs and fintechs with a significant interest in the PSD2 arena to join us, to bolster our efforts in supporting TPP interests vis-à-vis banks, as well as national and European authorities.”
“We are delighted to strengthen our position with the launch of the ETPPA, and we encourage all bank-independent TPPs and fintechs with a significant interest in the PSD2 arena to join us, to bolster our efforts in supporting TPP interests vis-à-vis banks, as well as national and European authorities.”
According to him as well, the PSD2 may try to abolish the monopoly that banks have over accounts data of their customers.