Plaid has agreed to JPMorgan’s demands to pay for access to customer data, following accusations that aggregator firms were overloading its systems with unnecessary requests.
JPMorgan shocked the data aggregation market last month by announcing it would no longer allow fintech companies free access to its data. In June, an internal memo revealed that out of 1.89 billion data requests from intermediaries, only 13% were initiated by customers for transactions. Notably, only 6% of Plaid’s API calls came from customers.
The bank claims most API calls were made for purposes like enhancing fintech products, preventing fraud, and even harvesting data for resale. The renewed agreement with Plaid will ensure continued access to customer data, though the pricing details remain undisclosed. JPMorgan is also in negotiations with other vendors, with reports suggesting that fees will vary based on use case, particularly impacting firms in the payments sector.
Plaid has stated that this deal, which extends the existing contract, will not affect its current customer agreements or pricing. “This agreement establishes continuity,” said Freya Petersen, Plaid’s head of corporate affairs. “We still believe consumers should have an unfettered right to access and control their own financial information and will continue to advocate for that.”