On January 27, 2025, the European Central Bank (ECB) adopted Decision (EU) 2025/222, titled “Decision of the European Central Bank on access by non-bank payment service providers to Eurosystem central bank operated payment systems and central bank accounts” (ECB/2025/2).
This decision expands access to Eurosystem payment infrastructures, allowing non-bank payment service providers (PSPs) to participate directly in systems like TARGET, thereby fostering financial inclusion, competition, and resilience in the euro area’s payment ecosystem.
The ECB oversees several critical payment systems, including TARGET, which facilitates large-value euro transactions, and other retail payment infrastructures like TIPS.
Historically, access to these systems was restricted to credit institutions (banks) and specific supervised entities.
However, the evolving payments landscape and industry—driven by technological innovation and the rise of non-bank PSPs— have now prompted the ECB to reassess its access policies.
Decision ECB/2025/2 aligns with the Eurosystem’s goals of promoting efficient, safe, and inclusive payment systems while ensuring a level playing field and maintaining financial stability.
The decision permits non-bank PSPs, specifically payment institutions and electronic money institutions authorized under EU directives, to open central bank accounts and participate directly in Eurosystem-operated payment systems.
This reportedly includes TARGET and any future systems designated by the ECB Governing Council.
As clarified in the update, access is not extended to non-supervised entities or PSPs offering services outside the scope of payment or electronic money issuance, ensuring that only regulated entities qualify.
To participate, non-bank PSPs must meet stringent conditions:
- Authorization: Entities must hold a license as a payment institution or electronic money institution under Directive (EU) 2015/2366 or Directive 2009/110/EC, respectively, and be supervised by a national competent authority in the euro area.
- Residency: Applicants must be established in a euro area country or a non-euro area EU Member State that has a cooperation agreement with the Eurosystem.
- Operational Standards: PSPs must comply with the oversight and operational requirements of the designated payment system, such as liquidity and risk management rules.
In addition to this, the ECB retains discretion to reject applications should participation poses risks to the system’s stability, security, or public interest.
Eligible non-bank PSPs can open payment accounts at Eurosystem central banks to settle transactions directly.
These accounts support liquidity management and access to intraday credit, subject to collateralization requirements aligned with Eurosystem monetary policy frameworks.
Importantly, overnight credit or uncollateralized facilities remain unavailable, preserving the distinction between monetary policy tools reserved for banks and payment system access.
The decision introduces a harmonized application process managed by national central banks, with the ECB Governing Council holding ultimate approval authority.
Approved PSPs fall under Eurosystem oversight, ensuring compliance with anti-money laundering, counter-terrorism financing, and cybersecurity standards.
The ECB can suspend or terminate access if participants fail to meet ongoing requirements or if systemic risks emerge.
This decision marks a shift in the Eurosystem’s approach, reflecting the role of non-bank PSPs in retail payments and digital finance.
By enabling direct access, the ECB aims to reduce dependency on intermediary banks, lower transaction costs, and enhance competition.
It supports the EU’s broader financial integration agenda, complementing initiatives like the Digital Euro project.
But the ECB emphasizes that financial stability remains paramount, with safeguards like discretionary rejection powers and strict eligibility criteria designed to mitigate risks.
Decision ECB/2025/2 reportedly takes effect on February 21, 2025, following its publication in the Official Journal of the European Union.
It applies across all Eurosystem central banks, thus helping with ensuring uniform implementation.
It can be concluded that the ECB/2025/2 aims to modernize the Eurosystem’s payment infrastructure by cautiously opening it to non-bank PSPs, balancing innovation with stability in the euro area’s financial ecosystem.