Need to Know
- Bank of America is working with Plaid through a data-sharing agreement, which allows customers to see which third-party services they have shared their data with.
- Plaid sends an email notification when the customer connects a new third-party service, which triggers a full list of all connected accounts as well as a link to the bank’s security center.
- While other banks provide similar services, the Bank of America integration is unique in that it provides a push notification, rather than allowing the customer to passively find the list of connected third parties.
Bank of America is democratizing data access for its customers, partnering with Plaid to provide a top-down look at third-party services that clients have shared their data with.
Plaid, which is a financial services startup based in California, will notify Bank of America customers of all their Plaid-linked accounts. The notification will be provided as an email, which will then allow the customer to navigate towards their Bank of America account and its Security Center, where they can restrict or halt access to any third-party service. This is different from Plaid integrations provided by other banks, which rely on customers to find a list of connected services themselves.
Writing in Forbes, fintech journalist Scott Harkey suggested that the function could be “a deliberate attempt by the bank to better educate their users and draw attention to connections they may have forgotten they made.” In other words, Bank of America is looking to help its customers restrict their data sharing simply by reminding them that they’ve been sharing data. Harkey also suggested that partnerships like the Plaid-Bank of America one are a sign that financial institutions “trying to make it easier for customers to share their data; albeit in a way the banks have some control over.”
The Bank of America partnership comes just weeks after a $5.3 billion deal for Visa to acquire Plaid was called off. Of the deal falling through, Plaid CEO Zach Perret said, “Unfortunately, the pace of a multi-year regulatory review is not compatible with the fast-moving realities of a startup—and delaying close to another year or more is not in the best interest of our customers, the financial system, or consumers themselves.”
Perrett added at the time that Plaid has “made significant progress in the ways that we work with financial institutions. Delivering on the promise of open finance is in everyone’s best interest, and we’ll be working in lockstep with our customers and financial institutions to bring this to fruition globally.”
Bank of America has accelerated its focus on its digital customer experience in recent months. At the beginning of 2020, the bank began looking to citizen developers for input on ways to apply machine learning techniques to products resistant to automation, and innovative ways to apply data to better predict customer demand. In September, Bank of America rolled out upgraded digital and mobile experiences, including enhancements to Erica, Bank of America’s AI assistant; at the time, BoA reported a 15% year-over-year spike in mobile-only users. And in October, the bank launched new digital financial planning tools, which allow customers to set goals within the BoA mobile app, or via its browser version.