Open Banking in Italy: How Businesses Pay Faster

For merchants, importers, and high-risk platforms, open banking in Italy marks a structural shift in how businesses move money — and TODA Pay exists to help them capture that shift before it becomes standard. Europe’s third-largest economy, with €2.2 trillion in GDP and 59 million consumers, now operates under a PSD2 framework that mandates bank API access for licensed third-party providers. With 71.4% of Italian financial professionals viewing open banking positively, the commercial infrastructure is ready.

What PSD2 Means for Italian Business Payments

The EU’s Payment Services Directive 2 (PSD2), enforced by Banca d’Italia, requires every Italian bank to provide secure API access to authorised third-party providers. This regulation created two licensed provider categories that directly serve business payment needs: AISPs (Account Information Service Providers) and PISPs (Payment Initiation Service Providers). Strong Customer Authentication (SCA) governs every transaction, eliminating fraud vectors that plague card-based systems.

PSD2 delivers four concrete operational advantages for businesses integrating open banking payments in Italy:

• Direct bank connectivity — licensed PISPs initiate payments straight from customer accounts, removing card networks and their associated fees entirely.
• Mandatory data access — banks cannot refuse API access to authorised TPPs, giving merchants reliable infrastructure with legal backing.
• SCA protection — every payment requires bank-level authentication, reducing fraud liability for the merchant to near zero.
• Consumer consent framework — GDPR-aligned data sharing rules protect both merchants and customers, building transaction trust at scale.

Italy’s regulatory structure makes open banking one of the most secure payment channels available to businesses operating across the EU.

Italy’s Open Banking Market: Growth Figures That Matter

The commercial case for open banking in Italy rests on verified market trajectory. Digital banking penetration doubled from 22% in 2013 to 51.55% by 2023, and seven million Italians actively use digital banking today — a figure Statista projects to reach 8.55 million by 2028. Italian merchants operating through traditional card networks face a narrowing window before A2A payments become the dominant checkout method.

Early adoption of open banking payments Italy delivers compounding advantages: lower per-transaction costs, higher authorisation rates, and access to a customer base actively migrating away from cash and cards.

Core Open Banking Use Cases for Italian Merchants

Account-to-account payments address the specific friction points Italian merchants face — high card processing fees, slow settlement cycles, and cross-border transfer delays. A2A payments reached 18% of Italian e-commerce transactions by early 2024, driven by checkout speed and the absence of card entry requirements. Businesses integrating open banking Italy solutions now access the full range of payment scenarios from a single API.

Four use cases generate the highest ROI for merchants operating in Italy:

• Pay by Bank at checkout — customers authenticate payments directly within their banking app, eliminating 3D Secure friction and reducing cart abandonment.
• Instant cross-border settlements — A2A transfers reach beneficiaries in real time, resolving the timing gap that costs 29% of Italian investors missed opportunities annually.
• Bulk payments for SMEs — platforms and importers execute mass payouts to suppliers, contractors, and partners through a single API call, replacing manual transfer workflows.
• Recurring billing without card dependency — subscription platforms collect payments directly from bank accounts, removing expiry date failures and card replacement disruptions.

Each use case reduces operational overhead while increasing payment success rates — a direct impact on revenue per transaction.

Why High-Risk Merchants Choose Open Banking in Italy

Card networks impose structural disadvantages on high-risk merchants: elevated processing fees, chargeback exposure, and reserve requirements that constrain cash flow. Open banking in Italy eliminates these friction points by bypassing card infrastructure entirely. iGaming operators, importers, and multi-sided platforms transact directly bank-to-bank, with authentication handled by the customer’s own institution.

High-risk businesses gain four specific protections through open banking:

• Zero chargeback exposure — bank-authenticated A2A payments cannot be disputed through card network chargeback mechanisms, removing the primary revenue leakage channel.
• No card data stored or transmitted — sensitive payment credentials never pass through merchant systems, eliminating PCI-DSS compliance burdens.
• Lower false decline rates — bank-direct authentication produces higher approval rates than card network fraud screening, particularly for cross-border transactions.
• Regulatory standing — transacting through licensed PISPs places high-risk merchants within the PSD2 compliance framework, strengthening relationships with banking partners.

For merchants previously excluded from standard card processing, open banking payments Italy represents a compliant, scalable alternative with lower total cost of acceptance.

Connect to Italian Banks Through a Single API

Italy’s open banking infrastructure covers the country’s largest banking groups — UniCredit, Intesa Sanpaolo, Banco BPM, and BNL — alongside hundreds of regional institutions. TODA Pay consolidates this coverage into a single API integration, removing the technical overhead of direct bank connections. Merchants, platforms, and importers connect once and access the full Italian banking network alongside 2,000+ partner banks across 28 countries.

Businesses connecting through TODA Pay’s open banking Italy infrastructure receive:

• Single API access to Italy’s major banks and regional institutions without individual integration agreements.
• E-commerce plugin compatibility for immediate deployment across existing checkout environments.
• Multi-region coverage extending A2A payment capabilities across the EU, UK, and beyond from one integration point.
• Real-time transaction data enabling cash flow visibility and automated reconciliation across payment corridors.

Italian merchants and international businesses entering the Italian market gain compliant, bank-direct payment infrastructure without the overhead of traditional financial institution relationships. Connect your business to Italy’s open banking network — TODA Pay handles authorisation, compliance, and bank connectivity so your team focuses on growth.

Frequently Asked Questions

Is open banking available for businesses in Italy?

Open banking operates fully in Italy under the EU’s PSD2 directive, supervised by Banca d’Italia. Licensed TPPs — including payment initiation and account information providers — connect directly to Italian bank APIs serving business accounts.

How does PSD2 protect businesses using open banking in Italy?

PSD2 mandates Strong Customer Authentication and restricts data access to licensed providers only. Businesses transacting through authorised platforms gain bank-grade security without storing or transmitting sensitive card data.

What payment methods does open banking replace in Italy?

Open banking payments replace card networks, manual bank transfers, and third-party wallets for merchant transactions. Account-to-account transfers eliminate intermediaries, reducing processing fees and settlement delays simultaneously.

Can high-risk merchants use open banking payments in Italy?

High-risk merchants — including iGaming operators, importers, and subscription platforms — access open banking payments through licensed PISPs in Italy. This structure eliminates chargeback exposure while maintaining full PSD2 regulatory compliance.

How fast are open banking payments settled in Italy?

Open banking payments in Italy settle instantly or near-instantly through direct bank-to-bank transfers. Merchants receive confirmed funds without the processing delays typical of card-based payment infrastructure.