The Minister for Finance has today signed EU regulations designed to further protect consumer payments.
Minister Paschal Donohoe said the vast majority of the provisions of the revised Payment Services Directive or “PSD2” will come into place tomorrow.
It will allow third-party payment providers access to bank account details with a customers permission.
The introduction of open banking is designed to break the monopoly banks have on personal account data.
"PSD2 will ensure that consumers have stronger rights and greater choice when using payment services," said Minister Donohoe.
"The main changes introduced by PSD2 are the addition of two new categories of payment services providers to be regulated, greater protection for consumers, and the introduction of new rules on strong customer authentication and secure communication which are intended to make payments safer," he added.
The measures could reduce the need for a credit card and introduce more direct transactions between customers and retailers.
"Banks had a monopoly over the data inside [current accounts] up until now. This data will now be shared with many third parties, only with permission and an awful lot of security around it," said PwC Partner Sinead Ovenden.
"As a result of that, you're going to have a lot of new entities which will be regulated and have authority to use that information to create new products and services," she added.
The regulations build on the framework first established by the original Payment Services Directive in 2007, which introduced changes to address the rapid growth in the number of electronic and mobile payments and the emergence of new types of payment services in the marketplace.
The main changes introduced by the new rules include the:
A small number of provisions will come into operation 18 months from the date the regulatory technical standards on strong customer authentication and common and secure open standards of communication enter into force.