Infrastructure-as-a-Service platform FinTech Automation (FTA) signed an agreement with Mastercard company Finicity on Tuesday (Jan. 4) to access consumer information for secure account validation and ownership when opening new accounts.
Consumers can now connect their primary accounts to deposit funds into a new investment account, which will minimize risk by verifying the owner of an existing account.
“Secure account opening is a must-have for financial institutions, and open banking data can improve the process and mitigate risk associated with digital account opening,” Andy Sheehan, Finicity president and chief operating officer, said in the joint announcement.
“FTA’s integration of Finicity’s open banking platform will further allow consumers to take charge of their financial data and financial futures,” Sheehan said.
FTA will also use consumer-permissioned data from Finicity’s open banking platform to give consumers a complete picture of their finances across all their financial and wealth accounts, and will allow customers to download all transactions from their wealth accounts into their personal financial management tool.
“Integrating consumer-permissioned data from Finicity’s open banking network streamlines account opening and funding, making it safer, easier and faster, which reduces account opening abandonment for our customers,” David Park, founder and CEO of FinTech Automation, said in the announcement.
“It’s a great example of how open banking can improve banking and personal financial management offerings and their customer experience at the same time,” Park said.
The new platform will also allow financial institutions and FinTechs to embed additional services into existing software.
Finicity CEO and co-founder Steve Smith recently told PYMNTS CEO Karen Webster that regulations haven’t kept up with U.S. companies’ progress in bringing innovation to the payment systems that undergird the digital economy.
In open banking, a lack of a preexisting regulatory framework for data portability is holding back innovations that other markets may soon come to take for granted, Smith said.