The big new fees JPMorgan Chase is planning to charge some financial technology companies may well trickle down to consumers, several fintech CEOs tell Forbes.
Two months ago, Chase sent messages to fintech data aggregators like Plaid, whose software connects fintech apps to consumers’ bank accounts. The bank said it would be introducing new fees for the aggregators to access to consumers’ bank data, which had previously been free. The fees are set to take effect very soon, since Chase told aggregators they’d start charging them in 60 days. Chase spokesperson Drew Pusateri says the bank is still in active negotiations with aggregators. But after two months of back and forth, no agreements have been announced.
The fintech CEOs we spoke with who run personal finance and investing apps expect aggregators to pass on the costs of Chase’s new fees to their customers, causing their own companies’ costs to rise. Now, those CEOs are considering raising prices for consumers–or eliminating free features altogether–to offset the potential blow to their finances. Plaid spokesperson Freya Petersen declined to comment on whether Plaid will pass on the data access fees to its clients.
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Popular personal finance app Rocket Money gives consumers visibility into their spending by displaying their recurring and one-time purchases. For a monthly fee, it also cancels consumers’ unwanted subscriptions. The app has four million paying subscribers and uses Plaid to connect to consumers’ bank accounts and pull in their spending data. Regarding Chase’s new fees, Rocket Money cofounder and CEO Haroon Mokhtarzada thinks they’ll get passed on to Rocket Money. So he’s considering raising prices for his subscribers, who currently pay $8 to $9 a month on average for the service. “Consumers are going to take the hit in the end. That’s just the way these things work,” he says.
Rocket Money also has millions of additional users for the free version of its service, which lets people view their spending habits. Mokhtarzada says he’ll probably have to start charging for that feature or remove it altogether if his data aggregator costs go up substantially.
San Francisco-based startup Monarch Money has an app with more than 500,000 paying customers that also shows people their spending patterns. Like Rocket Money, it uses Plaid extensively–Plaid is its largest bill each month, according to cofounder and CEO Val Agostino. He says if JPMorgan Chase’s fees end up being small, “We’ll probably just eat it … If they’re larger, we may have to pass that on to our customers by increasing pricing.”
Agostino thinks banks are “fundamentally hurting their own customers” if they start putting up new barriers that prevent people from being able to monitor their finances through fintech apps. “If the whole industry starts to follow this, I think we are going backwards as a financial ecosystem in this country.”
Investing app Betterment also uses Plaid, and CEO Sarah Levy has a similar perspective. “If my costs go up, my pricing will need to go up,” she says. Other fintechs like Chime and PayPal have said they don’t expect Chase’s fees to have a material impact on their businesses.
Chase spokesperson Pusateri says the bank has always had the right to charge fees for data access. “Data middlemen want a system that gives them limitless, free access to a product that they turn around and sell—and they want that system to last forever. But that system isn’t working and has led to overuse of customer data, an increase in associated fraud claims, and dramatically increased costs for JPMorgan Chase.”
He adds that aggregators gather data more frequently than customers expect and that in the past year, Chase has received almost $50 million in fraud claims originating from bank transfers that were facilitated by aggregators. He didn’t respond to our question on whether Chase sees a higher fraud rate with transfers that come through aggregators versus transfers coming from other sources. Pusateri also says aggregators can have a big impact on data access fees by adjusting how their software works.
Plaid spokesperson Freya Petersen said in an emailed statement, “Data access isn’t a gift banks give fintechs, it’s a right consumers have. The idea that consumers should pay to access their own financial history is a step backward.” She added that Plaid has had data access with banks agreements for years, but “it is only now, in a period of regulatory ambiguity, that the largest and most financially successful bank in the U.S. is proposing new restrictions.” She also said Plaid has built “some of the most advanced anti-fraud infrastructure in the market, and if banks are struggling with fraud, we are happy to help them improve their security standards and combat fraud more effectively.”
Last week, the Consumer Financial Protection Bureau (CFPB) took its first step in rewriting 1033, the hotly debated federal regulation that hangs over data aggregator fees and governs access to consumers’ banking data. The rule was finalized in late 2024 by the Biden Administration, but the Trump Administration announced last month it would rewrite the regulation. The CFPB is now seeking input from banks and fintechs on topics like whether data access fees should be charged and if there should be a cap on such fees.
One big question remains unanswered: How did Chase come up with the fee prices it proposed two months ago? Comments previously made by banks and fintechs at the end of 2023, which were submitted as part of the Biden Administration’s writing of the current 1033 rule, help provide context. Companies’ responses showed that banks’ costs to run the data connections ranged from $2 million to $47 million a year, with a median cost of $21 million. Even when adding those estimates to $50 million in annual fraud claims, the costs don’t exceed $100 million. That seems to be a wide gap from the fees that Chase proposed two months ago: According to a person briefed on those fee prices, they would cost aggregators like Plaid an estimated $300 million a year.
Chase declined to comment specifically on how it decided what fees to charge, which leaves many fintech CEOs guessing about what the bank’s goals and motivation are. Rocket Money’s Mokhtarzada says, “If Chase said, ‘Look, we’re going to calculate the exact cost of this, and we’re just going to pass on those costs and nothing else,’ I don’t think that people would have huge problems with that … But that’s not what’s going on.”
If the aggregators and fintechs can’t reach an agreement in their negotiations, the last resort will likely be a lawsuit against Chase, which could be initiated by a fintech, a fintech-focused trade organization or even a state attorney general office, according to industry insiders.
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