The integration is based on Plaid’s Open Finance solution, Core Exchange. It provides the 13 million Wise customers with the ability to move money securely across their own accounts. To do so, costumers just need to connect their Wise USD local account details in their app of choice and use Wise with the Plaid-powered apps and services. The Plaid network covers more than 6,000 apps.
The Core Exchange integration is live for Wise customers, and early insights show that they are already leveraging a variety of use cases, including peer-to-peer payments and investment platforms. Business customers in the US are using it to send funds to payroll companies, and business customers globally are connecting to neobanks, as well as paying credit card bills and paying tax in several states.
The collaboration with Wise is an example of Plaid’s advocacy for universal data access in which consumers are in control of where and how their data is used and permissioned, resulting in expanded access and insights across all their accounts.
A survey by Plaid and The Harris Poll shows that a majority of the US consumers (69%) would consider switching institutions if their primary account could not connect to their fintech apps and services. The agreement between Plaid and Wise comes in to solve the issue by serving consumers a secure data access to their financial services.
By working with Plaid, Wise offers its customers the ability to connect their accounts to US-based apps and services instantly and without hidden fees.
As delivering secure data connectivity solutions to consumers is part of the mission of unlocking financial freedom for everyone, Plaid’s data connectivity solutions, including Core Exchange and Plaid Exchange, offer secure, easy-to-implement API products for all data partners. They help companies facilitate data connectivity on behalf of their customers.
However, while customers seek additional benefits from sharing their data, they are also increasingly wary that their data could be misused by the firms that hold it. A survey conducted by Statista shows that only 38% of US consumers completely trust the organisations they interact with to maintain the privacy of their data.
The consumer is the center of any Open Finance system. Consumer demand for products and innovations fueled by their own financial data is what drives Open Finance.
As Open Banking only works when someone is actively using their account with a bank, a person with no active bank account could be considered outside of the financial system and would struggle to access the options offered by Open Banking.
Open Finance goes beyond the scope of data and services available at a bank, covering a person’s entire financial footprint. With one’s consent, financial data related to pensions, tax, and insurance could all be accessed by a trusted third party. This opens up for better-tailored consumer services, for payments as well as other financial products.
Therefore, Open Finance may be defined as a continuation of Open Banking. It’s the next level in the democratisation of finance, and it aims to level the playing field so that consumers get better-tailored financial journeys.
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