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Access to X - How new data providers can foster innovation in Fintech

Lars Markull
Lars Markull
3 min read

In the last years, I said probably a few thousand times “our bank accounts contain a lot of value about ourselves”. And I am continuing to do so. If you have a bank account for a few years and are are not a cash-fanatic, the bank account will be able say a lot about your life stage, life choices and your personal preferences.

However, even though bank accounts contain a lot of data, often that data is not enough. I have been working with many startups over the last years, that were eager to benefit of the richness of the data in bank accounts but they quickly realized banks are not delivering sufficient data for their use case (either because they can’t or don’t want to). Bank account data was often a good starting point, but in addition they needed other sources to be able to build their product.

This week two “access to X” API companies raised money:

Firstly, the US startup Pinwheel provides access to payroll accounts and has raised 7 million USD from First Round Capital, Upfront Ventures and other investors. More than 82% people in the US get paid via direct debit from a payroll provider such as Gusto, Paychex or ADP. These payroll companies have detailed information about personal, employement and income details of their users (More insights). Pinwheel is focusing on different target groups of which one is (obviously) lenders.

Secondly, the London based Codat team raised 10 million USD from Index Ventures to expand to the US. The company provides API access to accounting tools and their customers are financial service providers that need access to detailed financial data of their SME customers to offer loans digitally (More insights).

These two companies are great examples that bank account data alone is sometimes not sufficent. Both companies operate in the lending space where a complete picture about the financial situations of their customers is not just nice-to-have but absolutely crucial to be able to conduct proper risk management. Pinwheel and Codat are both able to provide more data (e.g. employment history for Pinwheel and historic accounting figures for Codat) that are not accessible through the bank account alone. Lending is and will always be an area where financial service providers are on the hunt for the best data source (some other ones that come to my mind are Itembase and Upswot but I am sure there are many more).

Personally, I am very curious what other data silos in the Fintech area will be opened over the coming years and what use cases will be build on top of it – especially in combination with open banking. I think there are many areas besides lending that would heavily benefit of additional data. In the personal banking space, I am expecting this could be in the area of spending and contract advice.

Firstly, our bank accounts can tell a third party provider how much money we have spent and at which store. However, the exact items and other purchase details are still mostly unable to obtain. Digital receipt solution providers would be the perfect party to aggregate this data and make it available for other services. Especially expense management tools, loyalty schemes and other value-add schemes would be able to benefit massively of this data.

Secondly and tightly connected to the first point, the management of our personal contracts could benefit of additional data sources as well. With contracts I mean insurances, internet, phone or similar contracts that we pay for on a regular basis. Similar to our expenses, we can see these payments on our bank account but actual details about e.g. our insurances or phone contract are not accessible through the bank account alone. Being able to understand what kind of contracts a user is paying for would be highly valuable data for third party providers. This data is highly fragmented (many different providers) and very different for each category (Insurance vs. phone contract details). Therefore, this might be a bigger challenge to solve this entirely.

These are just two examples and there is a lot more. Open Banking, Open Finance or Open X are big topics. I have only touched the surface in this blog post. I would love to dive a little deeper but will leave this for another time / post. But if you happen to be someone that is looking at providing access to certain data silos or somebody who needs access to specific data silo that is currently unavailable – please reach out.

Open Banking


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