The bank reached deals with Plaid, Yodlee, Morningstar and Akoya, which are among the FinTechs that account for more than 95% of the data requests made by third-party apps connected to customer bank accounts, CNBC reported Friday (Nov. 14).
“We’ve come to agreements that will make the open banking ecosystem safer and more sustainable and allow customers to continue reliably and securely accessing their favorite financial products,” JPMorganChase spokesman Drew Pusateri told CNBC. “The free market worked.”
The deals are likely to lead to more banks charging third parties for access to their systems, after allowing FinTechs to do so at no charge for years, according to the report.
It was reported in July that JPMorganChase told FinTechs it would begin charging for access to customer bank information. A JPMorganChase spokesperson said at the time that the bank has invested heavily to develop a system that protects consumer data.
PYMNTS reported at the time that in accessing bank data for all manner of activities, such as verifying bank accounts or underwriting credit, fees would be passed along to FinTechs and possibly to their end clients.
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It was reported in July that JPMorganChase found that most of the application programming interfaces (API) calls from middlemen received by its systems in June came from FinTech companies. Only 13% of the data requests were initiated by the bank’s customers for transactions.
A JPMorganChase systems employee wrote in a memo that the requests “are massively taxing our systems.”
JPMorganChase and Plaid announced in September that they renewed their data access agreement and included in that agreement a pricing structure to ensure customers can continue to access their data “safely, securely, quickly and consistently into the future.”
The bank and Yodlee announced in a Nov. 7 press release that they strengthened their 20-year partnership with an updated data access agreement that includes mutual commitments and a pricing structure.
“As we look ahead, our collaboration will help improve financial wellness solutions for our customers and the overall open banking ecosystem,” Melissa Feldsher, head of consumer payments at JPMorganChase, said in the release.
