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Aiming to reduce the compliance burden, Poland’s financial regulator has made a variety of proposals to the EU that would soften elements of key regulations affecting the payments and crypto industries.
The Polish Financial Supervision Authority (PFSA) has presented proposals that it hopes will “contribute to strengthening the competitiveness of the economies of the European Union, including the Polish economy”.
Among the key recommendations are amendments to the second Payment Services Directive (PSD2), the Digital Operational Resilience Act (DORA), the new Markets in Crypto-Assets Regulation (MiCA), and the Payment Accounts Directive (PAD).
Updating PSD2
One of the headline changes is a move to simplify reporting obligations under PSD2 for branches of credit institutions.
The PFSA is proposing that these branches should report operational and security risk data only to the supervisory authority in their home country, rather than duplicating submissions to host country regulators.
The regulator believes this reform would reduce confusion and administrative burdens, especially for smaller branch offices that often rely on centralised assessments from their parent banks.
“A sufficient obligation will be to report data for branches of credit institutions to home country supervisors,” the PFSA says.
“The current obligation creates a significant burden on supervised entities, which, often in the case of branches, are small entities that do not have the expected data, which, without data from their parent companies, cannot meet the expected requirements.”
The regulator wants to eliminate any doubt as to which supervisor – home or host – supervised entities should report individual PSD2 data to.
“The proposal would require reporting only to the home competent authority, which would have the effect of reducing the regulatory burden on branches of credit institutions.”
Streamlining DORA
Another major proposal involves the removal of a reporting requirement under DORA.
Financial entities must currently submit annual updates to national regulators on new ICT outsourcing arrangements, detailing the types of service providers and contractual terms.
However, the European Supervisory Authorities (ESAs) decided in late 2024 to use broader ICT service registers as the primary data source for designating critical third-party providers.
In light of this, the PFSA is recommending the deletion of the now-redundant reporting clause in Article 28(3), arguing it will free up resources for entities to focus on actual cybersecurity measures and improve supervisory efficiency.
Consolidating the Interchange Fee Regulation
A third proposed simplification would address redundant reporting of card payment data under the Interchange Fee Regulation.
Currently, both payment service providers and card schemes must report similar data separately to the PFSA as well as the country’s central bank.
The regulator suggests consolidating this requirement so that only card schemes, which already compile the relevant information, are responsible for the reports, with the change aimed at removing duplicated obligations and improving data consistency.
It has suggested an “elimination of dualism”, which could spur “greater regulatory transparency” and reduce “redundant reporting obligations”.
Overhauling MiCA
The PFSA has also proposed changes to Articles 23 and 58 of MiCA, which impose strict limits on the issuance of asset-referenced tokens (ARTs) and e-money tokens (EMTs) based on transaction activity.
Under the current rules, if an issuer’s tokens are used for more than 1m transactions per day or exceed €200m in average total daily transaction value in a quarter, the issuer must cease further issuance and submit a remediation plan.
The regulator is calling for a more flexible approach, and proposes that exceeding these thresholds in a single quarter should not automatically trigger mandatory cessation.
Instead, it says, supervisory authorities should be granted discretion to assess whether intervention is warranted, and only if the limits are breached for two consecutive quarters should the automatic cessation and plan requirement apply.
The PFSA argues that current rules, designed to prevent tokens from becoming de facto substitutes for fiat currency, do not sufficiently account for the complexity of crypto markets and the inherent difficulties in estimating transaction volumes.
According to the regulator, this could help with a “reduction of the risks and costs incurred by the entrepreneur related to the possibility of exceeding the limits”, while also allowing supervisory intervention where it is necessary.
Paring back the PAD
Finally, the PFSA has called for the removal of Article 27 of the PAD, which currently obligates member states to report every two years to the European Commission on the status of basic and transferred payment accounts.
The original aim of this provision was to track access to basic banking services and monitor financial exclusion. However, the PFSA says that this objective has largely been met, with access to payment accounts having improved significantly across the EU over the past decade.
As such, it argues that the reporting obligation is now redundant and imposes unnecessary administrative burdens, stating that removing it would streamline PAD compliance without affecting consumer protection.
“Poland, as the country leading the work of the Council of the European Union, has the opportunity to contribute to the development of solutions that support the development of the EU financial sector and the security of its clients, and thus have a real impact on the future of the EU single market and the improvement of the competitiveness of the European economy,” the regulator has said.
And, as the European Commission and other stakeholders grapple with the need to reduce regulatory burdens, it will be interesting to see just how much attention the other member states pay to this plea.
