Reduced payer's liability for unauthorized payment transactions under the second Payment Services Directive (PSD2)

In 2015, the European legislator enacted the second Payment Services Directive, which, among other things, determines the payer's liability for unauthorized payment transactions. This paper will show that PSD2 has widened its scope and further reduces the payer's liability for unauthorized transactions, for example by making it impossible to hold the payer liable in case no strong customer authentication has been applied, by requiring supporting evidence to prove the payer's fraud or gross negligence and by applying the same rules when unauthorized transactions are initiated through a payment initiation service.