National Retail Payments Strategy until 2025

The National Retail Payments Strategy is a comprehensive plan developed by the Payments Systems Forum (FSP), an advisory body to Banco de Portugal, to promote secure, efficient, and innovative payment solutions in the Portuguese market. This strategy aims to improve accessibility and ensure the widespread adoption of electronic payment instruments. It focuses on four fundamental pillars: promoting a more informed society, leveraging the benefits of digital transformation, fostering a regulatory framework that promotes innovation and efficiency, and encouraging the adoption of more secure payment solutions.  

To enable users to make informed and efficient choices, the strategy emphasizes the need for comprehensive information and awareness campaigns. These initiatives, integrated into the first pillar of the strategy, aim to educate consumers, businesses, and public administration about the various payment solutions available and their functionalities. By providing clear and accessible information, the strategy aims to facilitate the adoption of the most appropriate payment instruments for different use cases.

However, the rapid digitalization of economies and societies requires the development of faster, more available, and easier-to-use payment solutions. It is in this sense that the second pillar of the strategy focuses on promoting greater use of contactless technology, which allows for faster and more convenient payments at point-of-sale terminals. It also encourages the adoption of instant transfers, which provide secure and real-time availability and confirmation of funds for both consumers and businesses. The strategy aims to expand the network of contactless payment terminals and cards, ensuring their activation and usability.

Furthermore, the strategy recognizes the importance of a regulatory framework that supports innovation and competition, while ensuring user security and protection. The third pillar highlights the implementation of strong customer authentication measures, as provided for in the second Payment Services Directive (PSD2). This includes the adoption of secure authentication mechanisms for online commerce and account ownership confirmation for payment security. The strategy also emphasizes the need to evaluate and review existing legislation to remove barriers that restrict the adoption of electronic payment instruments.

Alongside combating fraud, security is a fundamental aspect of payment instruments to build trust among users and ensure the stability of the payment market. The fourth pillar reinforces the importance of encouraging the adoption of more secure payment solutions today, and therefore, the plan includes the development and adoption of authentication and validation mechanisms that enhance the security of payment operations.

Payment service providers (PSPs) are also encouraged to choose strong authentication solutions that comply with regulatory requirements. In addition, mechanisms should be developed to allow users to increase security in payment operations, such as confirming the beneficiary's account ownership, known as Proxy Lookup. This service will be made available by Banco de Portugal to meet these needs and enhance convenience and security.  

In summary, the National Retail Payments Strategy in Portugal until 2025 aims to promote secure, efficient, and innovative payment solutions. Its main objective is, in a first layer, to empower users to make informed choices through comprehensive information campaigns and, in a second, to increase the prevention and capacity of systems, since the greater the innovation, the greater the sophistication of fraud.  

By embracing digital transformation and promoting a more inclusive and accessible payment ecosystem, the strategy seeks to drive the future of payments in Portugal. With the collaboration of key stakeholders, including the Government, Financial Institutions, and Payment Service Providers, the strategy aims to create a secure and efficient payment environment that meets the evolving needs of consumers, businesses, and the public sector.  

Overall, the National Retail Payments Strategy in Portugal presents a comprehensive and forward-looking approach that aims to maximize the benefits of digital payments for all involved stakeholders.

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