A guide to PSD2 in 2026: How marketplaces manage multiparty payment compliance

What is PSD2?

 PSD2 is the Second Payment Services Directive, the EU regulation governing how payments are processed, authorised, and secured across the UK and Europe. It applies directly to marketplaces that hold or manage transactions between buyers and sellers. Key obligations include Strong Customer Authentication for card payments, KYC and AML verification for sellers, and fund safeguarding. Working with an FCA-licensed payment provider transfers much of this compliance burden, so platforms can focus on growth rather than regulation.

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What PSD2 means for marketplace operators

The Second Payment Services Directive (PSD2) regulates payment services across the UK and European Economic Area. For most ecommerce businesses, the main impact is Strong Customer Authentication at checkout. For marketplaces, the obligations go significantly further.

When a platform sits between buyer and seller, controlling funds during settlement, it is providing a regulated payment service. This means the platform either needs its own licence or must work with a licensed provider that assumes regulatory responsibility. Marketplace operators must fall within this scope to avoid experiencing payment disruptions or  fines for noncompliance.

PSD2 introduced the commercial agent exemption, which allowed some platforms to operate without a licence by acting solely on behalf of one party. That means either the buyer or the seller, not both. In practice, most marketplaces act on behalf of both so that exemption does not apply to them.

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The three compliance obligations that affect marketplaces most

Strong Customer Authentication is the most visible requirement. SCA requires payment verification using at least two factors: something the customer knows, has, or is. For marketplace transactions, this is typically handled through 3D Secure (3DS) at checkout. SCA exemptions exist for low-value transactions below €30 and for recurring payments where SCA was applied at the point of setup. Platforms with high transaction volumes need a provider with intelligent exemption routing -one that applies SCA only where required and maximises approval rates elsewhere.

Seller KYC and AML verification is where many marketplace operators underestimate the workload. Under PSD2 and the UK's Payment Services Regulations, platforms must verify the identity of every seller before distributing funds to them. This includes identity checks, address verification, and in some cases enhanced due diligence for higher-risk sellers. Failure to verify sellers correctly creates liability for the platform, not just the payment provider.

Manual KYC processes are slow and error-prone at scale. A marketplace regularly onboarding new sellers needs automated verification built into the seller journey. 

Fund safeguarding is the third obligation. When a marketplace holds buyer funds before releasing them to a seller during an escrow period, those funds must be held in a designated safeguarding account, separate from the platform's own operating funds. This protects buyers if the platform becomes insolvent and is a direct regulatory requirement for any entity holding payment funds in the UK or EU.

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What happens when compliance fails

The consequences of non-compliance are concrete. Card issuers and banks can block transactions that fail SCA requirements, creating immediate revenue loss. The FCA can issue fines, restrict operating permissions, or require full licence applications. Platforms without proper seller verification also face liability for fraudulent transactions.

The most common compliance failure amongst growing marketplaces is outgrowing their original payment provider. A provider suitable for a single-vendor business often lacks the infrastructure for split payments, automated KYC, and fund safeguarding at scale. Platforms discover this at the worst possible time, during a period of rapid growth.

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How to choose a compliant payment provider for your marketplace

The right provider handles SCA, seller KYC, and fund safeguarding on your behalf, under their own regulatory licence. Here is what to verify before committing:

Regulatory authorisation is non-negotiable. Verify that your payment provider holds a valid payment institution licence issued by a recognised regulator in the markets you operate. A fully authorised provider carries complete regulatory permissions and takes the compliance burden off your platform entirely.

Automated seller onboarding with built-in KYC is the difference between a compliance burden and a compliant platform. Some providers offer KYC as an add-on or manual process. The best marketplace payment providers integrate verification directly into seller registration.

Escrow functionality matters for any marketplace where buyer trust depends on goods or services being delivered before funds are released. Escrow payments and delayed settlement require specific regulatory permissions and infrastructure. Not all providers offer it.

Split payment capability determines whether the provider can actually handle multiparty flows. A payment provider that processes funds as a single transaction and requires manual reconciliation afterwards is not built for marketplaces. Look for real-time split payments with configurable commission structures and support for multiple sellers per transaction.

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Provider comparison: PSD2 compliance for marketplaces 2026

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PSD3: what's coming next

The European Parliament and Council of the EU reached provisional political agreement on PSD3 in November 2025. Final texts are expected in the Official Journal in Q2 2026, with enforcement anticipated in 2027.

The most significant change for marketplace operators is a further tightening of the commercial agent exemption. Under PSD3, platforms acting on behalf of both buyers and sellers will have almost no grounds to avoid a payment licence. Many marketplaces currently operating under PSD2 exemptions will need to hold licences or work with a licensed provider before PSD3 comes into force.

The UK is not directly subject to PSD3 following Brexit. However, UK platforms serving EEA customers or operating in EU markets will need to comply. UK regulators are also developing parallel reforms under the National Payments Vision, expected throughout 2026 to 2028.

For marketplace operators, the practical implication is clear: if your platform handles funds between buyers and sellers, work with alicensed provider now. Ryft's embedded payment solutions are built for this compliance environment from the ground up.

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