Welcome to FDATA North America’s monthly newsletter! These regular dispatches will share developments from our organization and our 30+ member companies, all of which are promoting financial access and inclusion with open finance use cases. We also include a list of upcoming industry events, and coverage of any market developments that impact fintech innovators.
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Monthly FDATA Member Spotlight:Questrade
This month’s Member Spotlight features Christine Day, Chief Information Officer at Questrade, who explains the myriad ways that consumer-permissioned data sharing can add value, lower costs, increase competition, and increase personalization of a wide variety of financial products and services:
FDATA NA News
FDATA Applauds CFPB’s Release of Small Business Panel Proposals for Section 1033 Rulemaking. The Consumer Financial Protection Bureau (CFPB) has published proposals for the upcoming Small Business Regulatory Enforcement Fairness Act (SBREFA) panel for the Dodd-Frank Section 1033 rulemaking, and FDATA applauds the CFPB for this timely release. This outline marks the first concrete step toward implementation of an open finance system in the United States and affirms that consumers should have complete control over their financial data. If implemented, the framework envisioned within the outline will strongly align with the goals that FDATA North America has long supported: a national, technology-neutral financial data portability standard that will allow consumers to select in a more competitive ecosystem from the financial services providers that can best improve their financial wellbeing. FDATA North America commends the CFPB staff and Director Chopra for their diligent work and looks forward to working with the CFPB to promote an expansive, customer-centric proposed rule to implement Section 1033 of the Dodd-Frank Act. FDATA is in the process of preparing a comment letter to submit to the CFPB following completion of the SBREFA meetings.
Member News & Activity
Atomic Financial, a provider of payroll connectivity, announced that it is expanding its solutions suite beyond consumer-permissioned access to support connectivity for employer and human resource administrative systems. By offering broader integration options, Atomic aims to give customers the most comprehensive coverage, faster time from integration to go-live, and a vastly improved product experience when it comes to connecting with HR systems. This development makes Atomic the first to market with payroll connectivity integrations and authentications for both consumers and businesses to permission access to financial data in payroll systems and human resource platforms. Atomic’s EmployerLink solutions will initially support use cases for worker’s compensation insurance, earned wage access (EWA), and employer benefits.
Basis Theory’s co-founder Colin Luce joined Remy Blaire on Fintech.tv to discuss how companies use tokenization to handle financial data protection and compliance.
Codat published a new blog post entitled “What makes SMBs willing to share data with financial providers?” that shared their research showing 67 percent of SMB borrowers expressed willingness to share their financial data with credit providers. Codat’s research also shows that growing businesses and those open to alternative lenders are even more willing to share financial data, and that the ability to access better loan rates was the largest incentive for data sharing.
Envestnet’s Group President of Data & Analytics Farouk Ferchichi penned an article in Finextra entitled “We Must Accelerate Open Banking to Help Withstand Today’s Economic Volatility” which outlined how open banking can offer quick and reliable visibility of personal finances and gives users a more secure and seamless way to connect their financial accounts. They also produced an on-demand webinar entitled “Protecting customers, their data, and your business from financial fraud with account tokens” about how sensitive financial data can be protected from hackers and how complex account verification processes can be simplified via open banking.
Flinks published a new blog post by its product marketer Alex Coleman entitled “OAuth Performance: Improve User Experience and Increase Conversions” that describes how OAuth technology enables Flinks’ end users to connect their bank accounts to a chosen fintech without sharing credentials. This educational post includes screenshots and descriptions of of their authentication/onboarding flow, and describes hows OAuth eliminates errors and barriers from traditional login systems, such as password changes and multi-factor authorization.
MX’s Chief Advocacy Officer Jane Barratt joined Jim Marous on the Financial Brand to discuss how data and insight can transform banking into emotional relationships that can impact people, organizations, and communities. MX also published a video from their recent Money Experience Summit entitled “How Lenders Can Meet Borrower Expectations in Today’s Financial Climate” that featured discussion on how customer expectations of instant-access to a wide variety of products and services is driving further fintech innovation.
Petal’s Prism Data, an open banking analytics platform, recently introduced CashScore v3, a powerful new version of its CashScore credit scoring model that leverages anonymized, consumer-permissioned open banking data to fully illuminate a consumer’s true credit risk. CashScore v3 is the first-ever consortium-based cash flow underwriting model, built using millions of anonymized, consumer-permissioned records from a variety of different banks, credit products and customer segments. Similar to traditional models like FICO or VantageScore, Prism’s consortium-based CashScore v3 offers lenders a highly predictive tool they can use off-the-shelf to more precisely assess credit risk in any consumer context—from credit cards and personal loans to mortgages and auto loans, among others.
Plaid’s John Anderson, Head of Payments, joined the Payments Journal Podcast alongside Mark Smith, Head of Payments Business and Market Development at AWS, and Tim Sloane, Vice President of Payments Innovation at Mercator Advisory Group. The group discussed how data connectivity is empowering the democratization of payments, improving consumer experience, and constantly driving new use cases. Anderson also penned a post on Plaid’s blog on the subject of “safer, smarter, faster” bank payments.
Trustly’s Rick Costello, Head of Digital Commerce, spoke with Rethink Retail at NACS online about what Trustly’s open banking payments solutions can do for merchants, particularly in the convenience store business, including reducing payment fees and risks.
Vaultree’s Pedro Aravena wrote a post on the Dev forum entitled “What is the difference between API and SKD?” that explained the difference between APIs and SKDs. APIs perform the integration between systems and SKDs make it possible to create an application and can couple APIs — but not the other way around.
Vopay published a real-time payment guide intended for Canadian business owners looking to learn more about real-time payment technology. The guide explains the operations and advantages of real-time payments, and makes some predictions for their future.
Events and Submission Deadlines
- December 7: FDATA Global State of Open Finance. If interested in attending, please reach out to [email protected]
- January 6: Deadline to Submit Comments to US Small Business Administration (SBA) on Proposed Rule to Lift Moratorium on Issuance of Small Business Lending Company (SBLC) Licenses
- January 25– Deadline to Submit Comments to CFPB on SBREFA Outline of Proposals and Alternatives for Section 1033 Rulemaking
- January 29–30: Fintech Retreat San Francisco
- February 13 – 16: Merchant Advisory Group (MAG) Mid-Year Conference and Tech Forum
- March 6-7: Future Digital Finance
- March 19-22: Fintech Meetup
- April 16 – 19, 2023: NACHA’s Smarter Faster Payments 2023
- April 24-26: Transact by ETA
- April 26: Empire Fintech Conference