MX, a financial data platform and connectivity provider, announced the launch of its MXaccess platform today, according to a press release.
MXaccess, formerly called MX Portal, is an open finance API platform that enables banks, credit unions, digital banks and providers to improve customer data sharing experiences. The solution is intended to act as a transparent and secure method to share data, and repair broken connections caused through screen scraping.
“MXaccess is a fully featured API platform so every provider of financial account data can have a data sharing API. It’s not only for banks and credit unions either – it’s for every provider of financial accounts. Like crypto accounts, buy-now pay-later accounts, investment accounts, student loans, mortgages, insurance,” Brett Allred, Chief Product Officer at MX told FinLedger.
Open banking as a concept has driven massive amounts of conversation worldwide, especially given the large differences in meaning depending on who you ask.
While providers may advertise open banking, they could be deploying screen scraping tactics to drive cross-platform financial information in lieu of structured data ramps. Regulators, however, tend to be stricter with the definition, saving the term ‘open banking’ for formalized systems like those in the UK, EU and Australia, which provide extra layers of security and give consumers additional access and control over their financial data.
“With MXaccess you’ll lower fraud and security risk. Even though consumers are out there sharing their banking credentials, they still expect you to handle security and prevent fraud,” said Allred to FinLedger. “And in reality, most consumers don’t understand they are sharing banking credentials with someone besides their bank.”
The issues with screen scraping are wide ranging, with the practice working in some circumstances but raising questions regarding its security, efficiency and reliability.
Canada’s Advisory Committee on Open Banking recently handed in its three year investigation on the country’s potential for open banking, stating that current screen scraping methods are “unsecure, inefficient, unregulated, and an unreliable methods of data sharing.”
“Infrastructure is expensive,” said Allred. “Imagine having 100x more scraping than is happening today, 100x more traffic hitting your servers. Fintechs are growing fast. Scraping is an unnecessary tax on your infrastructure. It’s far more efficient to share the data via an API than have it scraped off a website.”
MXaccess is built using Financial Data Exchange (FDX) standards, removes screen scraping and provides tokenized, credential-free data access. The solution can be deployed as an on-premise or self-hosted platform, according to the release, and is designed for organizations that want more control of their open finance strategy.
This tokenized system streamlines onboarding for data recipients, such as aggregators, fintechs and banking institutions. This ability enables financial institutions to stay at the core of data-sharing experiences, while also allowing users to gain visibility and control over their data.
According to Allred, MX will even share the source code with financial institutions’ teams.
“MX has been collaborating across the industry to accelerate the end of credential-based data sharing while advocating for a more secure, token-based approach that gives consumers more control over what data they share, and how. With MXaccess, financial institutions and fintechs can uncover new sources of revenue and begin benefiting from bilateral API driven models,” MX Chief Advocacy Officer Jane Barratt stated in the release.
In other recent fintech news, American Express launched its digital business checking account, including the company’s first debit card ever. Bill.com also partnered with Marqeta, putting a squeeze on Ramp’s plans to target Bill.com customers.