Akoya operates an application programming interface (API)-based network that connects financial technology firms (fintechs) and data aggregator companies to financial institutions when consumers have given permission to release personal financial information to those third parties. The network was spun off from Fidelity Investments in February 2020.

Bank of America, Capital One, Citi, FMR LLC (the parent company of Fidelity Investments), Huntington Bank, JPMorgan Chase, KeyBank, PNC Bank, The Clearing House Payments Co., TD Bank, Truist, U.S. Bank, and Wells Fargo are the new owners.

Akoya, which launched in the second quarter of 2019, says its method of data sharing reduces cybersecurity and other risks versus exchanges between financial institutions and third parties when those third parties are given account login credentials by consumers or businesses.

Akoya's network enables consumers and businesses to control which data and account information is provided to fintechs and aggregators. Currently, when third parties are provided login details, they can "screen scrape" and obtain all data available on every consumer or business account tied to those credentials. JPMorgan Chase recently advised third parties they will not be able to access any account information after July 30, 2020, unless they agree to stop using customer login credentials.

The Akoya network uses the Financial Data Exchange (FDX) API standard. FDX is a nonprofit organization supporting a common interoperable, royalty-free API standard for providing access to financial data. At the end of 2019, 82 financial institutions and fintech/data aggregators were members of FDX.

There are dozens of fintechs in the U.S. They include alternative lenders, stock trading apps, blockchains, P2P money transfer firms, prepaid card program managers, neobanks, cryptocurrency companies, certain merchant acquirers, alternative credit reporting agencies, and others. There are a handful of U.S.-based data aggregators for financial services. They are led by Envestnet, Yodlee, ByAllAccounts, and Plaid (soon to be part of Visa).

Stuart Rubinstein is CEO at Akoya in Boston, Massachusetts, stuart@akoya.com, www.akoya.com.

© Copyright 2020 The Nilson Report

The Nilson Report. "API Network for Information Sharing." Issue (1170), 28 Feb 2020, nilsonreport.com/mention/480/akoya. Reprinted with permission.