New Q&A from the CSSF in relation to the definition of payment account

On 3 June 2020, the Commission de Surveillance du Secteur Financier (the "CSSF") published its Questions and Answers (the "Q&A") in relation to the definition of payment account in the context of payment services under the law of 10 November 2009 on payment services, as amended from time to time (the "Law").

The Q&A helps define what falls within scope of the Law and where service providers will need to comply with the obligations imposed by PSD2. There has been a lot of development in this space with new products and types of services allowing customers to use e-money and online platforms.

According to the Law, a payment account is defined as "an account held in the name of one or more payment service users which is used for the execution of payment transactions". Payment transactions are defined under the Law as "an act initiated by the payer or on his behalf or by the payee, of placing, transferring or withdrawing funds (...)". In this respect, the CSSF explains that:

• it is the functionality of the account rather than its denomination which determines whether an account shall be considered as payment account, and
• the different elements of "payment transaction" are alternative and not cumulative.

Therefore, any account used for the execution of payment transactions consisting in either the placement, transfer or withdrawing of funds should be considered as payment account.

The Q&A helpfully provides some examples of types of accounts which can be qualified as payments accounts and the focus is on the ability to place, transfer or withdraw funds and therefore accounts not destined for the execution of payment transactions (e.g. saving accounts allowing only the placement or withdrawal of funds or mortgage and loan accounts) are clearly excluded from the scope. An e-money account or wallet does not automatically fall within scope but if customers can use it for payments this will be the case.

The qualification of payment account is also relevant to determine whether certain services are to be considered as payment services under the Law since for certain payment services, the use of payment account is required.

The CSSF also clarifies the criteria to determine whether a payment account is to be considered as a payment account accessible online and this is important in terms of assessing whether access interface as required by PSD2 is necessary. What matters is whether the customer can access his account via technical means (internet browser or smartphone application), whether this is for consulting purposes to carry out transactions or both. Whether or not your customer actually makes use of this online functionality is irrelevant as far as the legal definition and obligations are concerned.

The Q&A is addressed to all payment services providers and electronic money institutions established in Luxembourg that offer payment accounts. Please contact our team for any questions regarding payments services or EMIs.

> Read the Q&A here