This month’s Member Spotlight features Cathy Ly, Vice President of Customer Experience and Operations, who tells us how challenger banks like EQ rely on customer-permissioned data access to offer custom and competitive financial services to a wide array of Canadians:
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.
Know someone who’d like to receive these monthly updates? Send them here to sign up!
This month’s Member Spotlight features Cathy Ly, Vice President of Customer Experience and Operations, who tells us how challenger banks like EQ rely on customer-permissioned data access to offer custom and competitive financial services to a wide array of Canadians:
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 is applauding the CFPB for this timely release. This outline marks the first concrete step towards the 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. We applaud the CFPB staff and Director Chopra for their diligent work and look forward to working with the CFPB to promote an expansive, customer-centric proposed rule to implement Section 1033 of the Dodd-Frank Act.
FDATA Highlights Importance of API Standards and Monitoring. As both Canada and the United States continue to move toward open banking via APIs, it is essential that minimum API standards be set in open banking frameworks to ensure that consumers and SMEs have uninterrupted access to their financial data. To this end, FDATA has developed four principles that will be critical to the design of a well-implemented API environment in North America. These principles cover data scope, reliability standards, fallback options, and the necessity of establishing a neutral monitoring agency.
Codat published an article in Fintech Times explaining how open banking could be the key to reducing the funding gap for small businesses. Codat uses its recent research, which found a negative attitude toward available financing options among SME decisionmakers.
DirectID recently announced a partnership with SME capital provider GOT CAPITAL, which will allow SMEs applying for financing to use the power of Open Banking within the application journey and allow agents at Got Capital to quickly categorize and determine businesses’ true revenue without the need for PDF or paper bank statements. This new solution will allow for a much faster and accurate process, de-risking the financing while providing a better experience for SMEs.
Fiserv’s Vice Chairman Frank Sanchez joined the Tearsheet Podcast to discuss the promise and challenges associated with next generation cores, how fintechs are leveraging them in pushing open finance forward, what sets them apart from legacy banking cores, and what innovations we can anticipate in the near future.
Flinks published a new blog post by its product marketer Alex Coleman entitled, “Open Banking: Building or Buying,” which describs the state of open banking in several nations and explains the role of data intermediaries, particularly data aggregators, in establishing connectivity between financial institutions and consumers and SMEs.
Interac sponsored an event in Ottawa on open banking. Hosted by The Globe and Mail, the event featured panels that discussed the framing of open banking, data privacy and security, and accreditation and liability. Abraham Tachjian, Canada’s Open Banking Lead, closed the event by discussing what’s next for open banking now that the work of the working groups is coming to a close.
Kabbage was listed as a winner for this year’s IBSIntelligence NeoChallenger Bank Awards 2022. This recognition showcases its commitment to backing small businesses through innovative and impactful banking technology.
Morningstar ByAllAccounts published a whitepaper entitled “Open Banking for Wealth Management in the United States,” which advocates for open baking within the investment and wealth management sphere. The whitepaper explains how today’s open banking direct data connections provide reliable and secure access to the critical data necessary to provide personalized advice and maximize positive client outcomes.
MX’s Bose Chan, Head of Strategic Partnerships, joined the LiminalStrategy State of Identity podcast with Cameron D’Ambrosi to discuss what open banking means for banks, how it differs from end users or non-banking entities, and what to consider when building open banking capabilities.
Plaid’s Ginger Baker wrote a post for their blog entitled, “Access to financial data helps consumers navigate a difficult economy.” The post detailed how the growth of fintech adoption will increase the role that financial service providers have in helping their consumers tap into the benefits of data connectivity. The post included a link to Plaid’s recently published report, “The Fintech Effect: Stability, Impact, and Building for the Future,” which offers the latest data on consumer trends and insights on the future of digital finance.
Petal was named to CB Insight’s Fintech 250 list of most promising fintech companies around the world and Tracxn’s Emerging Startups 2022: Top Payment Startups.
Trustly welcomed back its founder Alex Gonthier, who will now operate as CEO of its Americas division. They were also featured in FinExtra’s first-ever North American 2023 Digital Banking Report where Nate Marquiss, Trustly’s Head of Finance, gave his expert take on what the future holds for Open Banking. They also published this blog post which highlights some key takeaways from this year’s G2E Summit, where they explored the future of all things Open Banking in the Gaming industry.
Vaultree has been shortlisted as one of the Top 50 global startups for the 4 Years From Now (#4YFN23) Awards 2023.
Vopay CEO Hamed Arbabi wrote an article for Fintech.Ca entitled, “Financial Inclusion Is Our Next Economy,” which detailed the reasons why many Americans remain unbanked, the risk of a cashless society, and how consumers could be better served by digital financial services.
October 27, 2022 Washington, DC- Following today’s Consumer Financial Protection Bureau publication of proposals for the upcoming Small Business Regulatory Enforcement Fairness Act (SBREFA) panel for the Dodd-Frank Section 1033 rulemaking, FDATA North America Executive Director Steve Boms released the following statement:
“FDATA applauds the CFPB for this timely release of its SBREFA outline. This outline marks the first concrete step towards the 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. We applaud the CFPB staff and Director Chopra for their diligent work and look forward to working with the CFPB to promote an expansive, customer-centric proposed rule to implement Section 1033 of the Dodd-Frank Act.”
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.
Know someone who’d like to receive these monthly updates? Send them here to sign up!
This month’s FDATA Member Spotlight features Dominique Samson, VP of Corporate Affairs at Flinks, who explains how improved data connectivity can reduce friction in the financial services ecosystem and benefit consumers with limited credit history:
FDATA submits comments to Canada’s Standing Committee on Finance (FINA) as part of its 2023 pre-budget consultations. In our submission to FINA, we called on the Canadian government to include language in Budget 2023 asserting the importance of governance in an open banking framework. We also argued that:
We also asserted that any open banking governance entity in Canada must be:
FDATA Highlights Importance of API Standards and Monitoring. As both Canada and the United States continue to move toward open banking via APIs, it is essential that minimum API standards be set in open banking frameworks to ensure that consumers and SMEs have uninterrupted access to their financial data. To this end, FDATA has developed four principles that will be critical to the design of a well-implemented API environment in North America. These principles cover data scope, reliability standards, fallback options, and the necessity of establishing a neutral monitoring agency.
APImetrics CEO David O’Neill joined a live webcast to discuss five lessons they’ve learned monitoring Open Banking stacks over the last three years. O’Neill also discussed what the experience has taught the company about DevOps in regulated sectors where it’s possible for two teams of operations engineers to face off in front of a regulator and be able to prove that they are both in the wrong.
Basis Theory was tagged as one of Business Insider’s “Most Promising Fintech Companies.”
Fiserv posted a new episode of its podcast, “Blurring the Line Between Fintechs and Financial Institutions,” which featured David McIninch discussing how the evolution is changing how people move and manage money while providing growing opportunities for financial institutions.
Flinks product marketer Alex Coleman published a new blog post, “Open Banking, Open APIs, OAuth: What Does It All Mean?,” which covered existing data aggregation methods, the transition to open banking, how APIs and Open APIs work, an intro into OAuth, and the security and legal implications of open banking.
MX’s Nicky Klein, VP of Open Finance, spoke at MX’s Money Experience Summit saying “not embracing open banking is hurting your business. If you don’t enable your customers to connect with the apps they want, they’re going to bank elsewhere.” MX also announced record-setting gains in financial data connectivity and the general availability of new product innovation and new implementation partners that bolster the MX platform.
Plaid published a new blog post Q&A with Colby Ross from Project Finance, a digital banking solution for banks and credit unions. Ross shared with Plaid how his company is using their Core Exchange integration to remove credential sharing, help customers achieve financial wellness, and build a customized world-class digital banking experience.
Validify has partnered with Insight, a financial services software provider, to be their selected banking and payment data provider to offer new, exclusive services to their customers. The two companies have collaborated to create custom, proprietary solutions, including TruBank and TruDDA. These powerful data services will be available only on Insight’s DecisionCloud Platform for the exclusive benefit of their customers.
Vaultree has shared the first episode of Vaultree Cast, a podcast “from data privacy enthusiasts to data privacy enthusiasts.” In this first episode, Thiago Alves, Head of Security Research at Mosyle, shares valuable cybersecurity career advice.
Vopay CEO Hamed Arbabi sat down with FinTec Buzz to chat about his career, payments modernization, entrepreneurship, how the pandemic has highlighted a strong need for innovation, and how businesses need to update legacy software and innovate their processes.
September 29, 2022, Washington, DC -As both Canada and the United States continue to move towards open banking via APIs, it is essential that minimum API standards be set to ensure that consumers and SMEs have uninterrupted access to their financial data.
To this end, FDATA has developed four principles that will be critical to the design of a well-implemented API environment in North America. These principles cover data scope, reliability standards, fallback options, and the necessity of establishing a neutral monitoring agency. These principles can be found here, and below:
Issues related to API robustness, reliability, and user experience have stunted the growth of open banking use cases in multiple markets across the globe that have moved more quickly than North America toward implementing legally binding customer financial data rights. It has been evident from experiences in Europe, the United Kingdom and Australia that well-defined standards without equally well-defined systems to measure them in a way that all parties can agree to leads to increased friction and a technical overhead placed on the regulator which they may not be well-positioned to adjudicate. Ensuring at the outset minimum API requirements for any open banking data providers, as well as a neutral monitoring entity to measure the quality and reliability of those APIs, will prevent Canada and the United States from experiencing similar issues as we begin our own North American open banking journey.
September 26, 2022, Washington, DC – Today, the Financial Data and Technology Association (FDATA) of North America submitted comments to Canada’s Standing Committee on Finance (FINA) as part of its pre-budget consultations in advance of the 2023 budget.
In its comments, FDATA North America called on the government to:
In the submission, FDATA NA also asserted that any open banking governance entity in Canada must be neutral (i.e. not controlled by any particular stakeholder(s) with commercial interests in the ecosystem), transparent (i.e. it invites and considers stakeholder input and subjects its decisions to an open, publicly visible process), and nimble (i.e. capable of making binding decisions relatively quickly and without undue bureaucracy), with all stakeholders in the open banking system agreeing to comply with the decisions and determinations made by the open banking governance entity as a condition of being active in the market.
A full copy of the submission is available below:
FDATA North America 2023 Pre-Budget Consultations
In this Member Spotlight, Betterment’s Associate General Counsel Josh Rubin explains how access to consumer-permissioned financial data is critical to Betterment’s ability to offer high quality, low-cost advice to everyday investors:
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.
Know someone who’d like to receive these monthly updates? Send them here to sign up!
In this Member Spotlight, Betterment’s Associate General Counsel Josh Rubin explains how access to consumer-permissioned financial data is critical to Betterment’s ability to offer high quality, low-cost advice to everyday investors:
FDATA To Host Virtual US Reporter Briefing on Open Banking and Section 1033 Rulemaking
Later this month, FDATA North America will host a virtual reporter briefing covering open banking in the United States and the status of the Consumer Financial Protection Bureau’s Section 1033 rulemaking. As the CFPB works to convene a SBREFA panel as part of this rulemaking, the briefing will feature insights from FDATA North America Executive Director Steve Boms, and representatives from five member companies including Plaid, MX, Trustly, Envsetnet, Morningstar, and Petal. Individuals interested in attending should contact [email protected].
FDATA NA Welcomes Newest Member Atomic Financial
FDATA North America is excited to announce its newest member Atomic Financial. Atomic is a Utah-based fintech that builds infrastructure for connecting payroll accounts to other apps, which can help with money management and income verification for lending.
Basis Theory published a new primer entitled “Data Security 101”, complete with visuals and examples, to help explain how encryption works to business leaders and product managers. Since there are many different ways to encrypt and decrypt data, uderstanding the fundamentals of data encryption can help design those solutions and remove some of the pain points.
BillGO published a new blog post entitled “Four Ways Your Consumer Benefit from Modern Bill Pay,” which details how easy, centralized biller set-up, secure payments using a virtual card, and instantaneous payments, confirmations, notifications and reminders provide value to customers.
Codat has joined the consortium of fintech and security compliance companies, supporting the Open Finance Data Security Standard (OFDSS), a proposed framework of requirements that address security risks commonly encountered by emerging fintechs that manage consumer financial information. The OFDSS is focused on setting a common standard for data security in the Open Finance industry and is designed to be a living document that will evolve over time to meet the needs of the industry, incorporate new technology, and mitigate emerging risks.
Envestnet has released a new report entitled “The Intelligent Financial Life: The Unexpected Intersection Between Technology, Clarity, and the Human Connection.” This report explores how clients’ attitudes toward financial advice, technology, and behaviors differ from one generation to the next.
Fiserv General Manager of Aggregation and Information Services , Jamie DelMedico, joined the Tearsheet Podcast to discuss how the evolution of data processes are helping drive the push toward open finance. Jamie explained how “the whole idea of open finance is powered by data, whereby the data from a financial institution or brokerage is pulled into an experience that then powers some other third-party experience…data is the crux of open finance.” He also shared some of Fiserv’s open finance use-cases and the potential of “alternative” financial data to expand access to credit.
Kabbage has been listed on this year’s Top 100 Financial Technology Companies by The Financial Technology Report. This recognition showcases its dedication for small businesses and its efforts to provide them with innovative products.
Morningstar announced an upcoming webinar entitled “Why open banking data access is essential for wealth management”, which will feature speakers from two FDATA NA Members as well as its Executive Director Steve Boms. The discussion will focus on how the current state of open banking in the US is rapidly evolving, why open banking is so significant for advisors and investors, how high-quality data makes a difference in powering investment solutions, and what to look for when partnering with a wealth data experts.
MX’s Lexi Hall sat down for a Q&A with Insider Intelligence, where she discussed the state of open banking regulation in the United States and the CFPB’s Section 1033 rule. She noted that “what’s exciting about open finance is that there is consensus around it….the industry has consensus on about 85% or 90% of the 1033 rule that the CFPB is considering. Some of the nuts and bolts that are still being decided, but we got here because the industry figured quite a lot of it out on its own.”
Petal was included in Forbes and TrueBridge Capital’s list of the US’s 25 venture-backed startups most likely to become unicorns. Using machine learning to analyze bank transactions, Petal offers credit cards to people who might previously have been disqualified. Since its 2017 launch, the New York City-based company has issued more than 300,000 cards with its banking partner WebBank.
Plaid’s Global Head of Policy John Pitts joined the Breaking Banks fintech podcast with Brett King to discuss how open banking can drive financial services toward a more consumer-centric model to build trust among users.
Trustly announced a new partnership with Conotoxia to give users a fast, safe way to transfer funds internationally via Open Banking. The company also published a blog post on the status of the developing Open Banking regulations in North America, and another that examines how new account-to-account payment trends are driving up the demand for more Open Banking solutions.
Validify published a new blog post entitled “Say No to Friction! Leverage Bank Data Without the Login” which explains how its frictionless, no login required, banking and payment solutions provideaccess to powerful bank and payment information without the associated friction.
Vopay published a new blog post entitled “Faster Payments: Fund Loans In Real-Time 24/7” which describes how lenders can benefit from real-time payments to rapidly fund their loans, avoid manual bank and credit card disputes, and save on transaction fees.
Xero announced a new partnership with the Canadian bank BMO to help small businesses further automate their bookkeeping tasks. This integration will enable BMO customers to connect directly and help gain back time previously spent on data entry and reconciliation. It will also introduce some new features, including tools to help customers automatically receive their latest transactions and account balances in their Xero account daily, a 1-year transaction and balance history right upon starting, and the ablity to modify or deactivate this integration at any time from their BMO account.
In this interview, Trustly Americas President Pete Ohser explains how consumer-permissioned data access greatly expands options, lowers costs, and removes barriers to financial services, as well as detailing how Trustly has been working with the policymaking and banking communities to make open banking a reality: