Plaid, fintech’s biggest winner.
The financial services sector has aggressively embraced digital transformation over the past few years, investing strategically in API-led connectivity to enable long term innovation.
Regulatory changes, in particular PSD2 in the EU and the Open Banking initiative in the UK, have pushed the industry towards data sharing as the new status quo, where banks are required to make functionality and data accessible for third party platforms through open source APIs. Traditional incumbents have been left feeling the competitive pressure from new market players who spotted the huge opportunity to open up new business models based on fast access and integration.
Take the example of Plaid, one of fintech’s biggest winners in recent years and now one of the world’s most widespread API providers. Acquired for $5.3 billion by Visa in early 2020, Plaid is the go-to connector of financial services data, integrating consumer banking data with third party fintech apps. Plaid’s API technology enables fintech companies to meet increasing customer demand for easy access to agile banking as well as bring new products to market quickly. Its API-led approach offers access to developers who want to create apps using banking data but need to bypass the challenges of integrating with the outdated legacy systems of traditional banks.
Plaid’s API platform now integrates with more than 15,000 banks in the US and Europe and connects to more than 20 million consumer accounts.