Dive Brief:
- JPMorgan Chase and one of the largest financial data aggregators, Plaid, announced an agreement Monday in which the fintech will face new fees to continue gathering consumer financial information from the largest U.S. bank.
- The companies presented their deal in a joint press release as one that allows “continued innovation” for U.S. open banking, which has been snarled in litigation and regulatory uncertainty for nearly a year since federal regulators enacted a rule in October 2024 smoothing the way for the new trend.
- Three trade groups representing fintechs criticized the new pact due to the fees. “Large data providers are exploiting the current period of regulatory uncertainty to impose unlawful tolls on consumers and competition,” Steve Boms, executive director of the Financial Data and Technology Association, said Monday in an emailed statement.
Dive Insight:
“The agreement, which includes a pricing structure, outlines a series of commitments that JPMC and Plaid made to ensure that consumers can access their data safely, securely, quickly and consistently into the future,” the companies said in their release.
JPMorgan Chase alarmed fintech groups in July when it informed them of substantial new fees to access consumer data the bank had previously transmitted without cost. The first JPMorgan Chase assessments – which a Stripe executive called “extortionate” in an Aug. 29 letter to the Consumer Financial Protection Bureau – are expected to begin this month.
A Plaid spokesperson, Freya Petersen, said in an email Monday evening that the agreement is “very custom” to Plaid and JPMorgan and extends a deal the companies have had since 2018. The new agreement with the bank won’t affect current customer agreements or pricing for the data it gathers and resells, Plaid said in the release.
Petersen declined to discuss details of the agreement or the fee structure. The agreement “entails planned technical improvements that will benefit Plaid and our customers,” Petersen said.
A JPMorgan Chase spokesperson said the bank had no further comment beyond the press release.
A spokesperson for the Financial Technology Association – where Plaid is a board member – said Monday that the FTA believes “that consumer data access fees are prohibited by current law and statute.”
“Furthermore, we believe that imposing exorbitant fees for this access is anti-competitive and harms consumers,” the association’s spokesperson said in an email.
The CFPB is working to revise its open banking rule, enacted under the Biden administration, and a federal court has paused banking groups’ litigation over the rule, pending the bureau’s work.
Congress prohibited such fees in the 2010 law authorizing a U.S. open banking regime, Boms said, and the CFPB “must move swiftly to enforce its final rule — so that consumers’ right to access and share their own financial data is upheld and competition in the marketplace is protected.”
The American Fintech Council said the agreement highlights fintechs’ broader concern that “allowing fees on consumer-permissioned data creates risks for competition and consumer choice.”
“We continue to believe there should be a clear prohibition on charging for data access,” Ian P. Moloney, the AFC’s head of policy and regulatory affairs, said Monday in an emailed statement. “In lieu of further affirmation from the administration, arrangements like this will continue to surface, reinforcing the need for policymakers to step in.”
San Francisco-based Plaid, MX Technologies and other financial technology firms aggregate consumer data for fintechs and others to power an array of financial apps and other digital tools. About 120 data aggregators connect financial data across different companies, according to the Bank Policy Institute.
Plaid says it serves more than 7,000 companies, including fintechs, crypto firms and many of the largest banks. In July, the three fintech groups and other associations wrote to President Donald Trump to request his help removing the bank’s fees and protecting the open banking rule.
