Important changes to online banking in Germany from September

Important changes to online banking in Germany from September

Important changes to online banking in Germany from September

Pretty much anyone banking in Germany uses online banking in some shape or form, whether that’s checking your balance on your mobile phone, paying for home utilities or just doing some online shopping. This September, however, a new EU directive to make internet banking safer comes into effect. Here’s a rundown of the most important changes.

PSD2: Safer online banking in Europe

The adjustments to online banking in Germany come as part of a new EU directive called PSD2. It might sound frightfully boring, but it’s serving a good cause: PSD2 is intended to increase security in online banking and strengthen consumer protection across Europe.

New log-in identifiers

From September onwards, anyone wanting to quickly check their balance online will need some extra unique identifiers, in addition to a username and password.

This “strong authentication” might consist of a biometric fingerprint, a card reader, or a unique code sent via SMS or an app. The long printed lists of TAN numbers, still sometimes used by German banks, look set to become obsolete.

Changes to online payments

As well as more rigorous log-in processes, there are also some important changes being made to online payments in Europe. Currently, if you are buying something online, you need to enter your card number, expiration date and three-digit security number.

From September onwards, security standards will be higher. A two-factor authentication will be required, consisting of something like a biometric identifier or a unique code generated by an SMS or smartphone app. A permanent password will no longer be allowed for this type of transaction.

Third party account access

This third change is optional. After September, it will be possible to allow third parties access to your bank accounts - for example, apps that manage multiple accounts or automatically settle your bills for online purchases.

These third parties will be strictly regulated by the Federal Financial Supervisory Authority, but it is important that you are aware of exactly who you have granted access to, and the consequences this could have. Third parties will be able to see everything that happens on your account, for example, if you receive child benefits, which kind of health insurance and private insurance you have, and how much you spend on bills.

Card payments

Okay, this one’s not strictly related to online banking, but we’ll just slip it in here anyway. The spending limit on contactless card payments is also going to rise. While you currently have to enter your PIN for anything above 25 euros, soon this is going to increase to 50 euros.

It is important to note, however, that this is merely a change in the legal limit; whether your contactless spend limit increases is entirely up to your individual bank.

Get prepared for banking changes in Germany

Exactly how and when these changes will come into force will vary according to which bank you are with. Now that the PSD2 directive has laid the groundwork, it’s up to banks in Germany to act. Keep an eye on your banking app and the post, as your bank will certainly contact you soon to let you know exactly what is changing for you.



Abi Carter

Abi studied History & German at the University of Manchester. She has since worked as a writer, editor and content marketeer, but still has a soft spot for museums, castles...

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