The Payment Initiation Services Provider (PISP) is able to initiate online and mobile payments to beneficiaries directly from the payers’ bank accounts. This can be done after the PISP receives formal approval. This is possible due to the fact that PSD2 obliges banks to grant access to customers’ payment accounts through the application programming interfaces (APIs). In other words, the payer provides short-term approval for the licensed intermediary via internet banking to initiate payment on his/her behalf.
Payment Initiation Services can be used for online purchases: customers instruct the PISP to make transfers from client bank accounts. This eliminates the need to use bank cards in the middle, which in turn increases security. PISP doesn’t manage the customer’s money, nor receives it; it only triggers transactions.
The PSD2 requires banks to open information about the users’ accounts via API. Account Information Service Provider (AISP) is authorized to view the customer’s payment account information in a bank, given such permission has been granted. This allows the AISP to aggregate account data from one or several banks in one place and allows them to view it on the AISP’s own interface. This gives the AISP the opportunity to offer services such as budgeting, data analysis, and other informative tools. AISPs are prohibited to use data received for purposes other than the one for which the customer has given approval.