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• CCPA vs GDPR : Understanding Their Impact on Data Analytics

  19 mars, par Alex Carmona

  With over 400 million internet users in Europe and 331 million in the US (11% of which reside in California alone), understanding the nuances of privacy laws like the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA) is crucial for compliant and ethical consumer data collection.

  Navigating this compliance landscape can be challenging for businesses serving European and Californian markets.

  This guide explores the key differences between CCPA and GDPR, their impact on data analytics, and how to ensure your business meets these essential privacy requirements.

  What is the California Consumer Privacy Act (CCPA) ?

  The California Consumer Privacy Act (CCPA) is a data privacy law that gives California consumers control over their personal information. It applies to for-profit businesses operating in California that meet specific criteria related to revenue, data collection and sales.

  Origins and purpose

  The CCPA addresses growing concerns about data privacy and how businesses use personal information in California. The act passed in 2018 and went into effect on 1 January 2020.

  Key features

  • Grants consumers the right to know what personal information is collected
  • Provides the right to delete personal information
  • Allows consumers to opt out of the sale of their personal information
  • Prohibits discrimination against consumers who exercise their CCPA rights

  Key definitions under the CCPA framework

  • Business : A for-profit entity doing business in California and meeting one or more of these conditions :
    • Has annual gross revenues over $25 million ;
    • Buys, receives, sells or shares 50,000 or more consumers’ personal information ; or
    • Derives 50% or more of its annual revenues from selling consumers’ personal information
  • Consumer : A natural person who is a California resident
  • Personal Information : Information that could be linked to, related to or used to identify a consumer or household, such as online identifiers, IP addresses, email addresses, social security numbers, cookie identifiers and more

  What is the General Data Protection Regulation (GDPR) ?

  The General Data Protection Regulation (GDPR) is a data privacy and protection law passed by the European Union (EU). It’s one of the strongest and most influential data privacy laws worldwide and applies to all organisations that process the personal data of individuals in the EU.

  Origins and purpose

  The GDPR was passed in 2016 and went into effect on 25 May 2018. It aims to harmonise data privacy laws in Europe and give people in the European Economic Area (EEA) privacy rights and control over their data.

  Key features

  • Applies to all organisations that process the personal data of individuals in the EEA
  • Grants individuals a wide range of privacy rights over their data
  • Requires organisations to obtain explicit and informed consent for most data processing
  • Mandates appropriate security measures to protect personal data
  • Imposes significant fines and penalties for non-compliance

  Key definitions under the GDPR framework

  • Data Subject : An identified or identifiable person
  • Personal Data : Any information relating to a data subject
  • Data Controller : The entity or organisation that determines how personal data is processed and what for
  • Data Processor : The entity or organisation that processes the data on behalf of the controller

  CCPA vs. GDPR : Key similarities

  The CCPA and GDPR enhance consumer privacy rights and give individuals greater control over their data.

  Dimension	CCPA	GDPR
  Purpose	Protect consumer privacy	Protect individual data rights
  Key Rights	Right to access, delete and opt out of sale	Right to access, rectify, erase and restrict processing
  Transparency	Requires transparency around data collection and use	Requires transparency about data collection, processing and use

  CCPA vs. GDPR : Key differences

  While they have similar purposes, the CCPA and GDPR differ significantly in their scope, approach and specific requirements.

  Dimension	CCPA	GDPR
  Scope	For-profit businesses only	All organisations processing EU consumer data
  Territorial Reach	California-based natural persons	All data subjects within the EEA
  Consent	Opt-out system	Opt-in system
  Penalties	Per violation based on its intentional or negligent nature	Case-by-case based on comprehensive assessment
  Individual Rights	Narrower (relative to GDPR)	Broader (relative to CCPA)

  CCPA vs. GDPR : A multi-dimensional comparison

  The previous sections gave a broad overview of the similarities and differences between CCPA and GDPR. Let’s now examine nine key dimensions where these regulations converge or diverge and discuss their impact on data analytics.

  

  #1. Scope and territorial reach

  The GDPR has a much broader scope than the CCPA. It applies to all organisations that process the personal data of individuals in the EEA, regardless of their business model, purpose or physical location.

  The CCPA applies to medium and large for-profit businesses that derive a substantial portion of their earnings from selling Californian consumers’ personal information. It doesn’t apply to non-profits, government agencies or smaller for-profit companies.

  Impact on data analytics

  The difference in scope significantly impacts data analytics practices. Smaller businesses may not need to comply with either regulation, some may only need to follow the CCPA, while most global businesses must comply with both. This often requires different methods for collecting and processing data in California, Europe, and elsewhere.

  #2. Penalties and fines for non-compliance

  Both the CCPA and GDPR impose penalties for non-compliance, but the severity of fines differs significantly :

  CCPA	Maximum penalty
  	$2,500 per unintentional violation $7,500 per intentional violation

  “Per violation” means per violation per impacted consumer. For example, three intentional CCPA violations affecting 1,000 consumers would result in 3,000 total violations and a $22.5 million maximum penalty (3,000 × $7,500).

  

  The largest CCPA fine to date was Zoom’s $85 million settlement in 2021.

  

  In contrast, the GDPR has resulted in 2,248 fines totalling almost €6.6 billion since 2018 — €2.4 billion of which were for non-compliance.

  GDPR	Maximum penalty
  	€20 million or 4% of all revenue earned the previous year

  So far, the biggest fine imposed under the GDPR was Meta’s €1.2 billion fine in May 2023 — 15 times more than Zoom had to pay California.

  Impact on data analytics

  The significant difference in potential fines demonstrates the importance of regulatory compliance for data analytics professionals. Non-compliance can have severe financial consequences, directly affecting budget allocation and business operations.

  Businesses must ensure their data collection, storage and processing practices comply with regulations in both Europe and California.

  Choosing privacy-first, compliance-ready analytics platforms like Matomo is instrumental for mitigating non-compliance risks.

  #3. Data subject rights and consumer rights

  The CCPA and GDPR give people similar rights over their data, but their limitations and details differ.

  Rights common to the CCPA and GDPR

  • Right to Access/Know : People can access their personal information and learn what data is collected, its source, its purpose and how it’s shared
  • Right to Delete/Erasure : People can request the deletion of their personal information, with some exceptions
  • Right to Non-Discrimination : Businesses can’t discriminate against people who exercise their privacy rights

  Consumer rights unique to the CCPA

  • Right to Opt Out of Sale : Consumers can prohibit the sale of their personal information
  • Right to Notice : Businesses must inform consumers about data collection practices
  • Right to Disclosure : Consumers can request specific information collected about them

  Data subject rights unique to the GDPR

  • Right to be Informed : Broader transparency requirements encompass data retention, automated decision-making and international transfers
  • Right to Rectification : Data subjects may request the correction of inaccurate data
  • Right to Restrict Processing : Consumers may limit data use in certain situations
  • Right to Data Portability : Businesses must provide individual consumer data in a secure, portable format when requested
  • Right to Withdraw Consent : Consumers may withdraw previously granted consent to data processing

  	CCPA	GDPR
  Right to Access or Know	✓	✓
  Right to Delete or Erase	✓	✓
  Right to Non-Discrimination	✓	✓
  Right to Opt-Out	✓
  Right to Notice	✓
  Right to Disclosure	✓
  Right to be Informed		✓
  Right to Rectification		✓
  Right to Restrict Processing		✓
  Right to Data Portability		✓
  Right to Withdraw Consent		✓

  Impact on data analytics

  Data analysts must understand these rights and ensure compliance with both regulations, which could potentially require separate data handling processes for EU and California consumers.

  #4. Opt-out vs. opt-in

  The CCPA generally follows an opt-out model, while the GDPR requires explicit consent from individuals before processing their data.

  Impact on data analytics

  For CCPA compliance, businesses can collect data by default if they provide opt-out mechanisms. Failing to process opt-out requests can result in severe penalties, like Sephora’s $1.2 million fine.

  Under GDPR, organisations must obtain explicit consent before collecting any data, which can limit the amount of data available for analysis.

  #5. Parental consent

  The CCPA and GDPR have provisions regarding parental consent for processing children’s data. The CCPA requires parental consent for children under 13, while the GDPR sets the age at 16, though member states can lower it to 13.

  Impact on data analytics

  This requirement significantly impacts businesses targeting younger audiences. In Europe and the US, companies must implement different methods to verify users’ ages and obtain parental consent when necessary.

  The California Attorney General’s Office recently fined Tilting Point Media LLC $500,000 for sharing children’s data without parental consent.

  #6. Data security requirements

  Both regulations require businesses to implement adequate security measures to protect personal data. However, the GDPR has more prescriptive requirements, outlining specific security measures and emphasising a risk-based approach.

  Impact on data analytics

  Data analytics professionals must ensure that data is processed and stored securely to avoid breaches and potential fines.

  #7. International data transfers

  Both the CCPA and GDPR address international data transfers. Under the CCPA, businesses must only inform consumers about international transfers. The GDPR has stricter requirements, including ensuring adequate data protection safeguards for transfers outside the EEA.

  

  Other rules, like the Payment Services Directive 2 (PSD2), also affect international data transfers, especially in the financial industry.

  PSD2 requires strong customer authentication and secure communication channels for payment services. This adds complexity to cross-border data flows.

  Impact on data analytics

  The primary impact is on businesses serving European residents from outside Europe. Processing data within the European Union is typically advisable. Meta’s record-breaking €1.2 billion fine was specifically for transferring data from the EEA to the US without sufficient safeguards.

  Choosing the right analytics platform helps avoid these issues.

  For example, Matomo offers a free, open-source, self-hosted analytics platform you can deploy anywhere. You can also choose a managed, GDPR-compliant cloud analytics solution with all data storage and processing servers within the EU (in Germany), ensuring your data never leaves the EEA.

  #8. Enforcement mechanisms

  The California Attorney General is responsible for enforcing CCPA requirements, while in Europe, the Data Protection Authority (DPA) in each EU member state enforces GDPR requirements.

  Impact on data analytics

  Data analytics professionals should be familiar with their respective enforcement bodies and their powers to support compliance efforts and minimise the risk of fines and penalties.

  #9. Legal basis for personal data processing

  The GDPR outlines six legal grounds for processing personal data :

  • Consent
  • Contract
  • Legal obligation
  • Vital interests
  • Public task
  • Legitimate interests

  The CCPA doesn’t explicitly define lawful bases but focuses on consumer rights and transparency in general.

  Impact on data analytics

  Businesses subject to the GDPR must identify and document a valid lawful basis for each processing activity.

  Compliance rules under CCPA and GDPR

  Complying with the CCPA and GDPR requires a comprehensive approach to data privacy. Here’s a summary of the essential compliance rules for each framework :

  

  CCPA compliance rules

  • Create clear and concise privacy policies outlining data collection and use practices
  • Give consumers the right to opt-out
  • Respond to consumer requests to access, delete and correct their personal information
  • Implement reasonable security measures for consumers’ personal data protection
  • Never discriminate against consumers who exercise their CCPA rights

  GDPR compliance rules

  • Obtain explicit and informed consent for data processing activities
  • Implement technical and organisational controls to safeguard personal data
  • Designate a Data Protection Officer (DPO) if necessary
  • Perform data protection impact assessments (DPIAs) for high-risk processing activities
  • Maintain records of processing activities
  • Promptly report data breaches to supervisory authorities

  Navigating the CCPA and GDPR with confidence

  Understanding the nuances of the CCPA and GDPR is crucial for businesses operating in the US and Europe. These regulations significantly impact data collection and analytics practices.

  Implementing robust data security practices and prioritising privacy and compliance are essential to avoid severe penalties and build trust with today’s privacy-conscious consumers.

  Privacy-centric analytics platforms like Matomo enable businesses to collect, analyse and use data responsibly and transparently, extracting valuable insights while maintaining compliance with both CCPA and GDPR requirements.

  Start your 21-day free trial today !

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• 7 Best Marketing Attribution Software in 2024

  22 février 2024, par Erin

  It can be hard to accurately track the impact of your marketing efforts across marketing channels and campaigns. That’s where marketing attribution software comes in. 

  It goes beyond basic web analytics solutions that just look at the final click. Instead, it shows how different channels, content, and ads are performing at every step of the buyer’s journey, which gives a more accurate picture than just focusing on the last click.

  In this guide, we’ll cover the basics of marketing attribution, list the top marketing attribution software and explain how the issue of privacy is transforming the web analytics industry.

  What is marketing attribution ?

  Marketing attribution is the process of assigning credit to each touchpoint in a buyer’s journey that leads to a desired action (such as a conversion or sale) in order to understand the effectiveness of various marketing channels and campaigns in influencing the customer’s decision-making process.

  Marketers use software tools like website analytics to to track and analyse customer interactions across different touchpoints, allowing them to attribute conversions or sales to specific marketing efforts and optimise their strategies and budgets accordingly.

  Why is marketing attribution so important ?

  If you don’t track your campaigns correctly, it’s easy to spend thousands (or even millions) in an ineffective way. A 2022 survey by Australian marketing agency Next&Co revealed their clients wasted AU$5.46 billion in ineffective ad spend.

  

  That’s 41% of all the ad spend tracked by Next&Co in 2022. A wasted marketing spend percentage this high isn’t exactly a recipe for a high marketing return on investment (ROI). And yet, it’s the average.

  Why is that ? 

  Most companies don’t actively track the results of their marketing campaigns actively enough.

  By improving your marketing attribution, you can determine which channels, ads, and campaigns work and which don’t. Then, you can move the budget from ineffective channels to effective ones.

  Even if you can only identify half of your wastage, this could be 20% or more of your total spend. Just imagine what your bottom line would look like if your marketing budget were 20% more effective.

  That’s the power that marketing attribution, when done right, brings to the table. It’s the road to a higher marketing ROI.

  Common marketing attribution models and how they’re different 

  The default model for attributing completed goals in most analytics tools is either the last interaction or the last non-direct interaction.

  However, some multi-touch models can help you get a more holistic view of the impact of your marketing efforts.

  

  • Last interaction model : attributes the conversion to the final interaction or referring source (campaign or ad).
  • Last non-direct interaction model : attributes the conversion to the final touchpoint that was not a direct visit to your website. (For example, if a search ad took them to a product page, the user bookmarked it and returned directly the next day to finish the purchase. The credit would go to the search ad as it’s the last non-direct touchpoint.)
  • First interaction model : attributes the conversion to the first referring event alone.
  • Linear model : gives equal value to every touchpoint throughout the customer journey. 
  • Time decay model : gives more value to touchpoints the closer they were to the actual sale.
  • Position-based model : gives more value to the first and last touchpoints — often 40% each, while splitting 20% among the rest.

  You can read our guide dedicated to marketing attribution models for more details on these models.

  Types of marketing attribution software and the impact of privacy regulations

  Until recently, digital advertising was the “scientific” advertisers’ utopia. Everything could be measured, with cookies from giants like Google and Facebook stalking every user across the web.

  But with the advent of regulations like GDPR and the CCPA, you can no longer blindly trust Google Analytics or the Meta Pixel without consequences.

  Multi-channel attribution tools with third-party cookies and GDPR

  Google, Meta, and other companies used to track and combine user data from their own platforms and websites across the web that installed their tags. These third-party cookies have long been under fire and have caused several GDPR fines.

  

  The alternative : analytics platforms with first-party cookies

  In a post-GDPR digital marketing landscape, a compliant-by-default web analytics platform like Matomo is a more reliable and accurate alternative.

  Plus, with a platform like Matomo, you don’t need to rely on data from digital advertising platforms like Facebook Ads and Google Ads. You can accurately track referral sources using our campaign tracking parameters.

  7 best marketing attribution software in 2024

  Below is the list of our favourite marketing attribution tools in 2024. If you find and use one that suits your needs correctly, you can quickly boost your marketing performance.

  1. Matomo — Accurate and easiest to set up for marketing attribution

  Matomo is a privacy-friendly web analytics suite that empowers you to accurately attribute marketing efforts and gain valuable insights while prioritising user privacy and compliance.

  Matomo integrates with e-commerce platforms like WooCommerce and Magenta. That makes it easy for B2C marketing teams to track the revenue impact of their campaigns.

  

  You can also compare a variety of attribution models against each other. B2B teams can use our API to integrate Matomo with their CRM.

  Pros :

  • Relies on first-party cookies for tracking, ensuring accurate data collection and attribution of user actions
  • Includes additional features like Heatmaps, Session Recordings, Form Analytics, A/B Testing, and more
  • Easy to set up and use
  • Features most common multi-touch attribution models

  Cons :

  • Limited to owned channels (website and e-commerce store) due to first-party cookies and data (but you can integrate other data sources through a CRM)

  Pricing

  The self-hosted version is free. The cloud hosted version starts at $19 per month and includes a 21-day free trial. No credit card requierd. 

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  2. WhatConverts — Great option for leads-based businesses with high ad spend

  WhatConverts is a marketing attribution tool with a focus on lead tracking. With most web analytics setups, it adds call and text tracking to the typical form-only tracking.

  

  Pros :

  • Reliable call and text tracking
  • Revenue attribution to specific leads (and, by extension, campaigns and ads)

  Cons :

  • Focused exclusively on leads — little utility for e-commerce companies 

  Pricing

  The cheapest plan starts at $30/month but does not include analytics integrations or form tracking. To access this and advanced flow tracking and attribution features, you need the Elite plan, which starts at $160/month.

  3. HubSpot Marketing Hub — Ideal CRM for larger B2B companies

  HubSpot is a marketing CRM with attribution features for tracking and analysis.

  

  The platform is very broad — encompassing CRM, email automation and other tools — which makes it challenging to use effectively. The price tag is also quite steep for smaller companies and marketing teams.

  Pros :

  • Concretely tracks revenue to multiple different touchpoints and marketing channels
  • Includes several different multi-touch attribution models
  • Allows offline conversion tracking

  Cons :

  • The price point is too high for smaller teams
  • Cam be difficult to set up effectively

  Pricing

  Since marketing attribution is only included in HubSpot Marketing Hub’s Professional and Enterprise plans, pricing starts at $800/month (paid annually). If you commit for a year but pay monthly, the price is $890/month for the professional plan. This goes up with additional add-ons and as your contacts increase as well. 

  4. ActiveCampaign — Good CRM option for small B2B companies

  ActiveCampaign is a CRM and marketing automation platform that can help you trace leads and revenue back to their source.

  

  Although it has a similar scope of features to HubSpot, it is more affordable and slightly easier to use for beginners.

  Pros :

  • Tracks sales revenue back to specific marketing touchpoints
  • Powerful marketing automation features

  Cons :

  • B2B companies may need to purchase two plans, one ActiveCampaign marketing and one CRM.

  Pricing

  Unlike HubSpot, ActiveCampaign offers a much more affordable plan, starting at $29/month billed annually (for up to 1,000 contacts). The marketing and sales CRM bundle starts at $93/month with up to five users.

  5. Salesforce Data Cloud for Marketing — Ideal CRM for enterprises

  Salesforce is a robust and feature-rich CRM that many enterprises rely on for their sales teams.

  

  That makes Salesforce’s marketing attribution platform a logical choice for existing Salesforce users.

  Pros :

  • Uses prospect and sales data from CRM to attribute revenue
  • Revenue prediction analytics
  • Lead scoring to help your sales team focus on high-value leads

  Cons :

  • Difficult to set up and use
  • Clunky and aged user interface
  • Relatively high price point

  Pricing

  The limited Marketing Cloud Account Engagement Growth plan starts at $1,250/month, billed annually. To access advanced cross-channel journeys, you need the Pro plan, which starts at $2,750 monthly.

  6. Terminus — Great for account-based marketing

  If your marketing team uses an account-based marketing (ABM) approach, Terminus might be the right option for you.

  

  It offers ABM tools like target account event tracking and revenue attribution tools for your marketing campaigns.

  Pros :

  • Advanced multi-channel revenue attribution tools with a wide range of reports
  • Track intent touchpoints back to target accounts
  • Reliable revenue predictions help you focus your marketing activities

  Cons :

  • Complex and difficult to set up, understand and use effectively
  • Lacks native integrations with many common advertising platforms and analytics tools

  Pricing

  Terminus offers no standard pricing plans. You must contact their sales team for a custom quote based on your needs.

  7. Adobe Analytics — An analytics for enterprises

  Adobe Analytics is part of the Adobe Experience Cloud, with plenty of big data analysis tools for enterprises. Although the platform is quite powerful, it is equally complex and difficult to use. The price point is also prohibitive for many smaller companies.

  

  Pros :

  • Very extensive reporting tools
  • Predictive analytics give you solid leading indicator for future campaign performance
  • Track multiple digital touchpoints across the entire customer journey

  Cons :

  • Like Google Analytics, Adobe Analytics aggregates your visitor data by default, making compliant “consent-free tracking” — tracking user actions without asking for consent — impossible according to GDPR. (See more differences in Matomo’s comparison against Adobe Analytics and Google Analytics.)
  • Prohibitively expensive for most smaller companies
  • Very steep learning curve for setting up and using it correctly

  Pricing

  Adobe Analytics uses usage-based pricing — which means they adjust the pricing based on the traffic volume to your website. Still, their lower price points aren’t exactly SMB-friendly — multiple sources put Adobe’s lowest starting price point at $2,000–2,500 per month.

  Get accurate marketing attribution with Matomo (without privacy concerns)

  Matomo allows you to do marketing attribution effectively and accurately without compromising your users’ privacy. By default, we only use first-party cookies and offer consent-free tracking – meaning no more annoying cookie consent banners (excluding in Germany and the UK).

  If you want to boost your marketing performance without disregarding your users’ privacy, get started with our 21-day free trial. No credit card required. It’s time to make more informed decisions about your marketing campaigns.

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• A Quick Start Guide to the Payment Services Directive (PSD2)

  22 novembre 2024, par Daniel Crough — Banking and Financial Services, Privacy

  In 2023, there were 266.2 billion real-time payments indicating that the demand for secure transactions has never been higher. As we move towards a more open banking system, there are a host of new payment solutions that offer convenience and efficiency, but they also present new risks.

  The Payment Services Directive 2 (PSD2) is one of many regulations established to address these concerns. PSD2 is a European Union (EU) business initiative to offer smooth payment experiences while helping customers feel safe from online threats. 

  In this post, learn what PSD2 includes, how it improves security for online payments, and how Matomo supports banks and financial institutions with PSD2 compliance.

  What is PSD2 ? 

  PSD2 is an EU directive that aims to improve the security of electronic payments across the EU. It enforces strong customer authentication and allows third-party access to consumer accounts with explicit consent. 

  Its main objectives are :

  • Strengthening security and data privacy measures around digital payments.
  • Encouraging innovation by allowing third-party providers access to banking data.
  • Improving transparency with clear communication regarding fees, terms and conditions associated with payment services.
  • Establishing a framework for sharing customer data securely through APIs for PSD2 open banking.

  Rationale behind PSD2 

  PSD2’s primary purpose is to engineer a more integrated and efficient European payment market without compromising the security of online transactions. 

  The original directive aimed to standardise payment services across EU member states, but as technology evolved, an updated version was needed.

  PSD2 is mandatory for various entities within the European Economic Area (EEA), like :

  • Banks and credit institutions
  • Electronic money institutions or digital banks like Revolut
  • Card issuing and acquiring institutions
  • Fintech companies
  • Multi-national organisations operating in the EU

  PSD2 implementation timeline

  With several important milestones, PSD2 has reshaped how payment services work in Europe. Here’s a closer look at the pivotal events that paved the way for its launch.

  • 2002 : The banking industry creates the European Payments Council (EC), which drives the Single Euro Payments Area (SEPA) initiative to include non-cash payment instruments across European regions. 
  • 2007 : PSD1 goes into effect.
  • 2013 : EC proposes PSD2 to include protocols for upcoming payment services.
  • 2015 : The Council of European Union passes PSD2 and gives member states two years to incorporate it.
  • 2018 : PSD2 goes into effect. 
  • 2019 : The final deadline for all companies within the EU to comply with PSD2’s regulations and rules for strong customer authentication. 

  PSD2 : Key components 

  PSD2 introduces several key components. Let’s take a look at each one.

  Strong Customer Authentication (SCA)

  The Regulatory Technical Standards (RTS) under PSD2 outline specific requirements for SCA. 

  SCA requires multi-factor authentication for online transactions. When customers make a payment online, they need to verify their identity using at least two of the three following elements :

  • Knowledge : Something they know (like a password, a code or a secret answer)
  • Possession : Something they have (like their phone or card)
  • Inherence : Something they are (like biometrics — fingerprints or facial features)

  

  Before SCA, banks verified an individual’s identity only using a password. This dual verification allows only authorised users to complete transactions. SCA implementation reduces fraud and increases the security of electronic payments.

  SCA implementation varies for different payment methods. Debit and credit cards use the 3D Secure (3DS) protocol. E-wallets and other local payment measures often have their own SCA-compliant steps. 

  3DS is an extra step to authenticate a customer’s identity. Most European debit and credit card companies implement it. Also, in case of fraudulent chargebacks, the issuing bank becomes liable due to 3DS, not the business. 

  However, in SCA, certain transactions are exempt : 

  • Low-risk transactions : A transaction by an issuer or an acquirer whose fraud level is below a specific threshold. If the acquirer feels that a transaction is low risk, they can request to skip SCA. 
  • Low-value transactions : Transactions under €30.
  • Trusted beneficiaries : Trusted merchants customers choose to safelist.
  • Recurring payments : Recurring transactions for a fixed amount are exempt from SCA after the first transaction.

  Third-party payment service providers (TPPs) framework

  TPPs are entities authorised to access customer banking data and initiate payments. There are three types of TPPs :

  Account Information Service Providers (AISPs)

  AISPs are services that can view customers’ account details, but only with their permission. For example, a budgeting app might use AISP services to gather transaction data from a user’s bank account, helping them monitor expenses and oversee finances. 

  Payment Initiation Service Providers (PISPs)

  PISPs enable clients to initiate payments directly from their bank accounts, bypassing the need for conventional payment options such as debit or credit cards. After the customer makes a payment, PISPs immediately contact the merchant to ensure the user can access the online services or products they bought. 

  Card-Based Payment Instruments (CBPII)

  CBPIIs refer to services that issue payment cards linked to customer accounts. 

  Requirements for TPPs

  To operate effectively under PSD2, TPPs must meet several requirements :

  Consumer consent : Customers must explicitly authorise TPPs to retrieve their financial data. This way, users can control who can view their information and for what purpose.

  Security compliance : TPPs must follow SCA and secure communication guidelines to protect users from fraud and unauthorised access.

  API availability : Banks must make their Application Programming Interfaces (APIs) accessible and allow TPPs to connect securely with the bank’s systems. This availability helps in easy integration and lets TPPs access essential data. 

  Consumer protection methods

  PSD2 implements various consumer protection measures to increase trust and transparency between consumers and financial institutions. Here’s a closer look at some of these key methods :

  • Prohibition of unjustified fees : PSD2 requires banks to clearly communicate any additional charges or fees for international transfers or account maintenance. This ensures consumers are fully aware of the actual costs and charges.
  • Timely complaint resolution : PSD2 mandates that payment service providers (PSPs) have a straightforward complaint procedure. If a customer faces any problems, the provider must respond within 15 business days. This requirement encourages consumers to engage more confidently with financial services.
  • Refund in case of unauthorised payment : Customers are entitled to a full refund for payments made without their consent.
  • Surcharge ban : Additional charges on credit and debit card payments aren’t allowed. Businesses can’t impose extra fees on these payment methods, which increases customers’ purchasing power.

  Benefits of PSD2 

  Businesses — particularly those in banking, fintech, finserv, etc. — stand to benefit from PSD2 in several ways.

  Access to customer data

  With customer consent, banks can analyse spending patterns to develop tailored financial products that match customer needs, from personalised savings accounts to more relevant loan offerings.

  Innovation and cost benefits 

  PSD2 opened payment processing up to more market competition. New payment companies bring fresh approaches to banking services, making daily transactions more efficient while driving down processing fees across the sector.

  Also, banks now work alongside payment technology providers, combining their strengths to create better services. This collaboration brings faster payment options to businesses, helping them stay competitive while reducing operational costs.

  Improved customer trust and experience

  Due to PSD2 guidelines, modern systems handle transactions quickly without compromising the safety of payment data, creating a balanced approach to digital banking.

  

  Banking customers now have more control over their financial information. Clear processes allow consumers to view and adjust their financial preferences as needed.

  Strong security standards form the foundation of these new payment systems. Payment provider platforms must adhere to strict regulations and implement additional protection measures.

  Challenges in PSD2 compliance 

  What challenges can banks and financial institutions face regarding PSD2 compliance ? Let’s examine them. 

  Resource requirements

  For many businesses, the new requirements come with a high price tag. PSD2 requires banks and fintechs to build and update their systems so that other providers can access customer data safely. For example, they must develop APIs to allow TPPs to acquire customer data. 

  Many banks still use older systems that can’t meet PSD2’s added requirements. In addition to the cost of upgrades, complying with PSD2 requires banks to devote resources to training staff and monitoring compliance.

  The significant costs required to update legacy systems and IT infrastructure while keeping services running remain challenging.

  Risks and penalties

  Organisations that fail to comply with PSD2 regulations can face significant penalties.

  Additionally, the overlapping requirements of PSD2 and other regulations, such as the General Data Protection Regulation (GDPR), can create confusion. 

  Banks need clear agreements with TPPs about who’s responsible when things go wrong. This includes handling data breaches, preventing data misuse and protecting customer information. 

  Increased competition 

  Introducing new players in the financial ecosystem, such as AISPs and PISPs, creates competition. Banks must adapt their services to stay competitive while managing compliance costs.

  PSD2 aims to protect customers but the stronger authentication requirements can make banking less convenient. Banks must balance security with user experience. Focused time, effort and continuous monitoring are needed for businesses to stay compliant and competitive.

  How Matomo can help 

  Matomo gives banks and financial institutions complete control over their data through privacy-focused web analytics, keeping collected information internal rather than being used for marketing or other purposes. 

  Its advanced security setup includes access controls, audit logs, SSL encryption, single sign-on and two-factor authentication. This creates a secure environment where sensitive data remains accessible only to authorised staff.

  While prioritizing privacy, Matomo provides tools to understand user flow and customer segments, such as session recordings, heatmaps and A/B testing.

  Financial institutions particularly benefit from several key features : 

  • Tools for obtaining explicit consent before processing personal data like this Do Not Track preference
  • Insights into how financial institutions integrate TPPs (including API usage, user engagement and potential authentication drop-off points)
  • Tracking of failed login attempts or unusual access patterns
  • IP anonymization to analyse traffic patterns and detect potential fraud

  

  PSD3 : The next step 

  In recent years, we have seen the rise of innovative payment companies and increasingly clever fraud schemes. This has prompted regulators to propose updates to payment rules.

  PSD3’s scope is to adapt to the evolving digital transformation and to better handle these fraud risks. The proposed measures : 

  • Encourage PSPs to share fraud-related information.
  • Make customers aware of the different types of fraud.
  • Strengthen customer authentication standards.
  • Provide non-bank PSPs restricted access to EU payment systems. 
  • Enact payment rules in a directly applicable regulation and harmonise and enforce the directive.

  Web analytics that respect user privacy 

  Achieving compliance with PSD2 may be a long road for some businesses. With Matomo, organisations can enjoy peace of mind knowing their data practices align with legal requirements.

  Ready to stop worrying over compliance with regulations like PSD2 and take control of your data ? Start your 21-day free trial with Matomo.