
JPMorgan Criticizes Fintech Middlemen for Overloading Systems with Unnecessary Data Requests
New York — JPMorgan Chase has accused financial data aggregators, including industry leader Plaid, of overwhelming its systems with excessive and often unnecessary data requests. According to an internal memo obtained by CNBC, only 13% of the 1.89 billion data calls made to JPMorgan’s systems in June were initiated by customers for actual transactions.
The memo, sent by a systems employee to JPMorgan’s head of retail payments, raised concerns over how these "middlemen", fintech platforms that enable financial apps to access traditional bank data, are putting undue strain on the bank’s infrastructure. The majority of these requests, known as API calls, are reportedly used for non-essential purposes such as improving product performance, fraud detection, or data harvesting.
JPMorgan, the largest U.S. bank by assets, is now preparing to impose access fees on these companies. People familiar with the matter say the new charges could begin as early as October. The move comes amid negotiations between the bank and several aggregators, who have long enjoyed free access to customer data under the principle of "open banking."
In one example cited in the memo, a single fintech company was responsible for more than 1 billion API requests in June alone, more than half of all aggregator traffic. While the company was not officially named, CNBC confirmed the largest player in the report was Plaid. According to JPMorgan's data, only 6% of Plaid's API calls in June were directly triggered by users.
Plaid responded, saying the figures “misrepresent how data access works.” The company argued that once users authorize access during sign-up, data can be pulled as part of standard services, such as alerts for overdraft fees or suspicious activity. “Calling a bank’s API when a user is not present is a standard industry practice supported by all major banks,” the company said.
The internal report also highlighted the growing financial and security risks posed by unchecked API usage. Transactions processed through aggregators were 69% more likely to result in fraud claims, the bank said. JPMorgan recorded $50 million in fraud from ACH payments initiated by aggregators and expects that number to triple in the next five years.
Industry backlash has followed reports of JPMorgan’s planned fees, with critics accusing the bank of trying to restrict competition and monetize access to customer data. Venture capitalists and fintech leaders have labeled the move as “anti-competitive,” particularly in light of the Biden-era open banking rule that required banks to share data with authorized parties at no cost.
However, that rule is currently facing a legal challenge supported by the banking industry. If overturned, banks may regain full control over whether, and how much, to charge fintech firms for access.
A person close to the ongoing talks said that both JPMorgan and the aggregators acknowledge the need to reduce the volume of data requests and are exploring solutions to balance system efficiency with consumer access.
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