At the end of each month, the SAFE Regulatory Radar highlights a selection of important news and developments on financial regulation at the national and EU level.
SIU: Shortening the settlement cycle and creating consolidated tapes
On 18 June 2025, the Council of the EU and the European Parliament reached an agreement on the amendment of the settlement cycle under the Central Securities Depositories Regulation (CSDR).
The legislative amendment shortens the settlement cycle of securities executed on EU trading venues from two days (‘T+2’) to one day (‘T+1’) after the trade.
The agreed amendment intends to align the EU with global developments as many jurisdictions have moved to a shorter settlement cycle. The change aims to increase liquidity, prevent fragmentation, and support the competitiveness of EU capital markets.
The co-legislators have also agreed to exempt specific securities financing transactions (SFTs) from the T+1 settlement cycle requirement. SFTs are financial arrangements that enable investors and firms to use assets - such as shares or bonds they hold - as collateral to obtain short-term funding.
To prevent potential circumvention of the shortened settlement cycle, the exemption will only apply to SFTs formally documented as a single transaction consisting of two linked operations.
The amendments become applicable from 11 October 2027.
On 18 June 2025, the Commission adopted an implementing act and three delegated acts under the Markets in Financial Instruments Regulation (MiFIR) which aims to consolidate the EU trading landscape for financial instruments and enable the creation of consolidated tapes.
Consolidated tapes consist of centralized data feeds that collect and disseminate real-time trade and quote information for securities into a single stream of information. They allow professional and retail investors and traders to see the best available prices and sizes for buy and sell orders across the entire market, rather than just on a single exchange. Hence, they allow investors to make more informed decisions and improve competition by driving trading to venues with better prices and high liquidity.
The technical standards introduced aim to ensure consolidated tapes are supplied with accurate, timely data. They outline the conditions under which consolidated tape providers can be authorized and establish a revenue-sharing approach for equity tape providers to compensate trading venues for contributing data. Additionally, the standards set out how market data should be made publicly available fairly, transparently, and non-discriminately while ensuring that any fees charged remain reasonable and justified.
Payments: Agreement on the negotiating position on payments’ regulation and the revision of the standardized terminology and disclosure documents
On 18 June 2025, the Council agreed to its negotiating position on the reform of the payment framework, namely the Payment Services Regulation and the Payment Services Directive. The objective of the Council’s mandate is to reduce payment fraud, promote technological innovation, better protect consumers and increase fee transparency.
The position establishes a robust and comprehensive framework to combat payment fraud. With scams like "spoofing fraud", where criminals impersonate a user's payment provider to gain their trust and deceive them, becoming increasingly frequent, the proposals introduce targeted measures to enhance consumer protection.
Key among these measures is requiring payment service providers to exchange fraud-related data. Additionally, a system must be implemented to verify that the IBAN and the recipient’s name match before a transfer is completed.
The Council’s negotiating stance reinforces these anti-fraud efforts by expanding the scope to include electronic communications providers, such as internet service operators and messaging apps, within the fraud prevention framework. It also ensures that consumers are not unfairly burdened in fraud cases and underlines the need for full compliance with EU data protection standards.
Greater transparency is another central pillar of the reform. ATM users will be shown all relevant fees and currency exchange rates before confirming a withdrawal. The Council has also proposed stricter rules on disclosing payment card scheme fees, ensuring consumers and businesses have clearer visibility over transaction costs and can make more informed decisions.
If agreement between the co-legislators is ensured, the proposals will create a new payment services regulation and amend the existing payment services directive (PSD2) to create a more modern framework in this field.
On 20 June 2025, the European Banking Authority (EBA) published its review of the standardized terminology related to payment accounts, as mandated by the Payment Accounts Directive (PAD). The review assessed the standardized terms initially issued in 2018, which aim to facilitate consumer comparisons of payment account fees and offers across the European Union.
The review concluded that the current standardized terms remain fit for purpose and do not require immediate changes. As a result, the EBA decided not to amend the Regulatory Technical Standards (RTS) at this time. Instead, the EBA plans to revisit the findings in four years or when significant market or legislative developments occur, ensuring the terminology remains relevant and practical. This decision aligns with the PAD's mandate for the EBA to regularly review and update the standardized terminology to provide clarity and consistency for consumers and stakeholders.
Sustainable finance: A framework for voluntary disclosure of climate-related financial risks
On 13 June 2025, the Basel Committee on Banking Supervision released a framework for the voluntary disclosure of climate-related financial risks.
The framework, which includes qualitative and quantitative elements, is designed to be adaptable. It acknowledges the evolving nature of climate-related data regarding accuracy, consistency, and quality.
The disclosure framework supports transparency and market discipline by helping banks disclose their climate-related financial risks. In this regard, it aims to complement existing frameworks. The disclosure framework is structured around four key pillars: governance, strategy, risk management, and metrics and targets.
Jurisdictions are invited to consider domestic implementation, but no mandatory adoption is required. In this regard, flexibility is a key feature of the framework, allowing it to accommodate variations in data availability and quality across jurisdictions.
The framework aims to provide a holistic view of banks’ climate risk exposures, recognizing that a combination of metrics and narrative information is necessary. The Committee underlines that disclosures should be interpreted holistically, acknowledging their limitations and the need for multiple metrics to capture the full scope of climate-related exposures.
The Committee will monitor international disclosure practices and other reporting frameworks and may revise the framework as needed based on future developments.
Updates:
- On 12 June 2025 the European Commission has proposed to postpone by an additional year the application of market risk prudential requirements foreseen under Basel III.
- On 17 June 2025 the European Commission has proposed to review the EU securitisation framework through amendments of the Capital Requirements Regulations and the Securitisation Regulation.
Public consultations
|
Pietro Chiarelli is Financial Policy Analyst at the SAFE Policy Center.
