Progress in open finance: An update from Plaid

Plaid partners with financial institutions to simplify the transition to open banking by providing secure, scalable API solutions that enable seamless data sharing. By collaborating closely with financial institutions, we help to ensure compliance with regulatory standards and modernization of infrastructure for data connectivity. This not only improves the customer experience but also reduces reliance on outdated practices like screen scraping, making open banking more efficient and accessible for institutions of all sizes.

Innovating for financial institutions  

Plaid is dedicated to working with financial institutions to meet their open banking obligations, ensuring their customers have seamless and secure access to the apps and services they need. We recently launched our Open Finance Solution, a suite of free products designed to help financial institutions comply with upcoming Section 1033 regulatory requirements with minimal effort required.  A key part of our Open Finance Solution is our FDX-aligned API spec Core Exchange, which helps banks connect to Plaid’s network. Today, thousands of financial institutions are able to build an API to FDX standards with Plaid. We continue to work with these institutions to ensure their consumers are protected while enjoying consistent and secure access through the open banking regulatory framework. The collaboration between Plaid and financial institutions is essential for the success of open banking. Together, we prioritize the security and privacy of consumers’ financial data, build trust, and ensure compliance with regulatory standards.

As part of our commitment to secure and reliable API connectivity, we’re continuing to build new functionality for our data partners. Before the end of the year, data partners can expect to see enhanced features in our data partner dashboard, including the launch of Integration Health, which will enable institutions to view errors, debug issues, and monitor the performance of their API. Once API performance requirements, such as uptime and latency, are finalized in the Dodd-Frank Section 1033 rule, which is expected to be issued this fall, we plan to update our tooling to provide insight into whether our data partners’ APIs meet those requirements.  

We’ll continue to expand our offerings for data providers—both individual institutions and platforms—so we can all work together to build a more secure and connected ecosystem that better serves the needs of consumers. 

Leading the API revolution

Today, we’re proud to announce that 80% of our traffic is now on or committed to APIs, marking a significant milestone in our mission to eliminate the industry’s reliance on screen scraping. Together with our financial institution partners, we’ve shifted to more secure and reliable connections that now power most of the ways people engage with their money. This year, we successfully completed major migrations to APIs with Citi and Navy Federal Credit Union, joining a growing list of major institutions like JPMC, Capital One, and Wells Fargo, that have partnered with Plaid to prioritize API connectivity. While this traction is significant, there’s more progress to be made. We continue to work closely with other institutions as we expand our list of agreements with the nation's largest financial institutions. We also partner with major bank platforms like Jack Henry, Q2, Fiserv, Finastra, Alkami, and FIS to ensure that many small- and mid-sized institutions can more easily enable open finance and secure connectivity on behalf of their customers.

Looking ahead: Getting ready for open finance 

Over the past decade consumers have gained the right to access and share their data, sparking the birth of open banking in the U.S. This revolution has transformed how consumers interact with their financial data, fueling innovation across thousands of apps and services that many of us use daily.

Plaid has been at the heart of this transformation, and we believe the next step is open finance—the extension of data rights across a consumer’s entire financial picture. We’re excited to work with thought leaders, policymakers, and industry experts to drive this development forward.

In the meantime, open banking regulation is also expected to be solidified in the U.S. later this year. Many players in the ecosystem—financial institutions, fintechs, and the like—will be required to implement APIs in the next few years, if they haven’t done so already. This is expected to be a regulatory and compliance mandate. Wherever you are in your compliance journey, Plaid is here to help. As the most experienced access provider with more than 80% of traffic on or committed to APIs, we have the tools that will help you with compliance while enabling your customers and consumers to enjoy seamless, secure connectivity to the digital financial ecosystem.   

On the whole, we will continue advocating for a fair financial ecosystem where consumers, regardless of where they bank, can share and control their financial data freely and securely. We’re proud of the progress we’ve made and look forward to continuing this work alongside our partners.