JPMorgan Chase (JPM) has signed revised contracts with fintech middlemen to get paid for most of the data requests third-party applications make on customer bank accounts, according to a media report on Friday.
The move comes after years in which firms traditional lenders and fintechs disputed over customer account access. Firms like Plaid tapped bank systems for free when a customer sought to use the likes of Robinhood (HOOD) to draw funds, for example. Morningstar (MORN), Akoya, Yodlee and Plaid are reportedly among the fintech intermediaries doing business with JPM.
Late last year, the Biden-era Consumer Financial Protection Bureau approved the so-called open-banking rule, requiring lenders to provide customer data to other financial firms for free. Banks sued to block it, and their challenge gained traction in May when the Trump administration urged a federal court to throw the rule out entirely.
After several weeks of negotiations, JPMorgan (JPM) backed off its initial pricing demands, ultimately settling on lower rates, people familiar with the matter told CNBC. The fintech intermediaries also secured concessions on how data requests will be handled.
“We’ve come to agreements that will make the open banking ecosystem safer and more sustainable and allow customers to continue reliably and securely accessing their favorite financial products,” JPMorgan spokesman Drew Pusateri said in a statement, CNBC reported. “The free market worked.”
CNBC noted that JPMorgan (JPM) and the fintech firms declined to disclose terms of their updated deals.