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Fintech startup Plaid raises $250M at a $2.65B valuation

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Re: Fintech startup Plaid raises $250M at a $2.65B valuation

#111

Post by semerda »

Congrats Plaid!

Is Open Banking Standards going to abolish any international market opportunities for Plaid?

- CMA9 Major Banks in the UK are ready to roll out Open Banking Standards. - In Australia the ACCC is pushing for 1 July 2019 and within 12 months all Australian banks, including the related brands of the big four, will be brought within the scope of open banking. - Canada too with it's 2020 initiatives.

US would be crazy not to adopt a similar standard but maybe this is where Plaid is specializing in due to the large number of US banks?

Re: Fintech startup Plaid raises $250M at a $2.65B valuation

#112

Post by semerda »

sjtgraham wrote: post #108
jaymzcampbell wrote: post #71

Earlier quoted context omitted.

It always blew my mind that services like Yodlee ( https://www.yodlee.com ) worked that way. I can understand it from the point of view that no traditional bank was set up to allow structured access but it never felt right to me. In the UK there is a big push around "open banking"[1] which will bring this into the 21st century and allow for proper programmatic access to data. It's still in it's infancy but the sector…

Open Banking and PSD2 are both complete failures. Who is in market with a decent product built on it? Nobody is. What people need to realise is that 1st party APIs are completely at odds with the incentives to maintain the status quo, i.e. they pose an intermediation threat and in the worst case relegate banks to mere utilities with zero margin. Furthermore a bank will never use it's own public API in it's own produc…

https://www.computerworld.com.au/article/646592/australia-bi...

"The ACCC envisages that the first tranche of open banking rules will come into effect from 1 July 2019. Within 12 months, all Australian banks, including the related brands of the big four, will be brought within the scope of open banking."

Re: Fintech startup Plaid raises $250M at a $2.65B valuation

#113

Post by semerda »

sjtgraham wrote: post #108
jaymzcampbell wrote: post #71

Earlier quoted context omitted.

It always blew my mind that services like Yodlee ( https://www.yodlee.com ) worked that way. I can understand it from the point of view that no traditional bank was set up to allow structured access but it never felt right to me. In the UK there is a big push around "open banking"[1] which will bring this into the 21st century and allow for proper programmatic access to data. It's still in it's infancy but the sector…

Open Banking and PSD2 are both complete failures. Who is in market with a decent product built on it? Nobody is. What people need to realise is that 1st party APIs are completely at odds with the incentives to maintain the status quo, i.e. they pose an intermediation threat and in the worst case relegate banks to mere utilities with zero margin. Furthermore a bank will never use it's own public API in it's own produc…

Good number of companies using it already https://www.openbankproject.com/apps/ and they claim 10K developers.

Re: Fintech startup Plaid raises $250M at a $2.65B valuation

#114

Post by ryanackley »

bdcravens wrote: post #90
ryanackley wrote: post #67

Earlier quoted context omitted.

You may not sell the data but you give developer's access to bank balance, transaction history, and income streams. Essentially some of the most private aspects of a person's life. Seems legitimately useful for personal finance tools or loan providers. However, I know your API is being used by point of sale systems. Seems super unethical for point of sale systems to access any info beyond, is this the right account,…

They do outline everything pretty well at https://plaid.com/legal/ , but I don't know that those terms are linked to from the login widget.

I can't tell if this is sarcasm.

As long as you're transparent about it in a 30 page ToS then it's all good. Because when you go to checkout at a cash register, you're going to stop and hold the line for an hour or more and read that page.

Not an exaggeration btw, my print dialog estimates that page to be 27 pages printed.

Re: Fintech startup Plaid raises $250M at a $2.65B valuation

#115

Post by sjtgraham »

semerda wrote: post #113
sjtgraham wrote: post #108

Earlier quoted context omitted.

Open Banking and PSD2 are both complete failures. Who is in market with a decent product built on it? Nobody is. What people need to realise is that 1st party APIs are completely at odds with the incentives to maintain the status quo, i.e. they pose an intermediation threat and in the worst case relegate banks to mere utilities with zero margin. Furthermore a bank will never use it's own public API in it's own produc…

Good number of companies using it already https://www.openbankproject.com/apps/ and they claim 10K developers.

That's not Open Banking. That's the Open Bank Project, a completely separate thing. They're a company that tries to sell their platform to banks and provide a FOSS sandbox.

Re: Fintech startup Plaid raises $250M at a $2.65B valuation

#116

Post by jimbru »

chatmasta wrote: post #29

Plaid is a great idea, but the implementation worries me. My understanding is that, for most banks, you give Plaid your username and password, and Plaid scrapers on their servers log into your online banking account. Even worse, Plaid obfuscates this behavior from users by replicating their banks login window and making it appear that you are logging directly into your bank. I'm not sure how to feel about this, becau…

> I understand that banks' lack of open API access is the central problem

Banks in the US are really behind the ball on APIs, it's true. Just recently things have started to change though. I'm the cofounder of Treasury Prime (https://treasuryprime.com/) and we have a network of banks in the US who offer API access.

It doesn't solve Plaid's use case (getting data out of 1,000s of banks), but it's great if you need deep integration into a single bank, like if you're writing a fintech app for example. If anyone would like access, feel free to email me: hello@treasuryprime.com

Also, big congrats to Plaid on the fundraise!

Re: Fintech startup Plaid raises $250M at a $2.65B valuation

#117

Post by frereubu »

sjtgraham wrote: post #109
smnrchrds wrote: post #60

Earlier quoted context omitted.

> bank could, quite reasonably, cut off your access for this. It's worse than that. Sharing passwords with third-parties typically "voids the warranty." If money is stolen from your account, the bank can deny reimbursing you because giving a third-party your password voids their zero-liability guarant guarantee.

This is actually false in many jurisdictions, including the entirety of Europe.

Can you link to some information about that? I know at least one of my banks (I'm in the UK) has that in their ToS. Is that invalid? If so, how?

Re: Fintech startup Plaid raises $250M at a $2.65B valuation

#118

Post by CodeSheikh »

I would not be comfortable giving my banks, cards info to Plaid so they can provide an easy integration (API) to third party developers.

Why Venmo would need to hit Plaid API to get my banking info when they can provide their own API and allow seamless integration with my bank and credit card?

I honestly don't see the benefit over risk of handing over all my financial institutions information so they can provide a seamless API to consumers.

Re: Fintech startup Plaid raises $250M at a $2.65B valuation

#119

Post by hndamien »

sjtgraham wrote: post #108
jaymzcampbell wrote: post #71

Earlier quoted context omitted.

It always blew my mind that services like Yodlee ( https://www.yodlee.com ) worked that way. I can understand it from the point of view that no traditional bank was set up to allow structured access but it never felt right to me. In the UK there is a big push around "open banking"[1] which will bring this into the 21st century and allow for proper programmatic access to data. It's still in it's infancy but the sector…

Open Banking and PSD2 are both complete failures. Who is in market with a decent product built on it? Nobody is. What people need to realise is that 1st party APIs are completely at odds with the incentives to maintain the status quo, i.e. they pose an intermediation threat and in the worst case relegate banks to mere utilities with zero margin. Furthermore a bank will never use it's own public API in it's own produc…

Or you just stop using banks and build these products on something like Bitcoin. It might pressure banks to open their APIs.

Re: Fintech startup Plaid raises $250M at a $2.65B valuation

#120

Post by sjtgraham »

frereubu wrote: post #117
sjtgraham wrote: post #109

Earlier quoted context omitted.

This is actually false in many jurisdictions, including the entirety of Europe.

Can you link to some information about that? I know at least one of my banks (I'm in the UK) has that in their ToS. Is that invalid? If so, how?

Re-read your bank ToS. If you're in Europe, it won't be in there. Such provisions are not compliant with PSD2.
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