JPMorgan to Impose Fees on Fintechs for Accessing Customer Data

JPMorgan Chase & Co., the largest bank in the United States, has announced plans to impose fees on financial technology (fintech) companies for accessing its customers' bank account data. This data is essential for various fintech services, including payments, trading, and money transfers. The bank has distributed pricing sheets to data aggregators—intermediaries that connect banks with fintech platforms—outlining new fees that vary based on usage, with payment-focused firms facing higher charges. JPMorgan justifies these fees by citing significant investments in creating a secure system to protect customer data. The fees are expected to take effect later this year, though they remain open to negotiation.

The announcement has sparked criticism from fintech firms and industry associations, who argue that it could hinder innovation and limit consumer access to financial services. The Financial Data and Technology Association (FDATA), representing data aggregators including Plaid, Intuit, and Trustly, stated that JPMorgan is "exploiting regulatory uncertainty to levy an arbitrary and punitive tax on competitive offerings," calling it a blatant effort to curtail innovation and undermine a stronger American financial system. Similarly, the American Fintech Council described the fees as "a shameless attempt to further entrench the position of incumbents," expressing concern that placing a tollbooth on data access will harm families that a safe financial system is meant to serve.

This development occurs amid ongoing regulatory discussions about open banking and data-sharing practices in the United States. In October 2024, the Consumer Financial Protection Bureau (CFPB) finalized a rule supporting open banking, granting consumers the legal right to share their financial data with third-party services. However, the rule does not explicitly prohibit banks from charging for access to that data, leaving room for institutions like JPMorgan to argue for compensation to maintain secure systems. The Bank Policy Institute, which counts JPMorgan as a member, has legally challenged the CFPB's open banking rule, arguing that the bureau exceeded its statutory authority. The outcome of this legal challenge could directly impact whether and how banks are permitted to charge for data access.

Following the announcement, shares of major fintech and payment companies experienced declines:

• PayPal (PYPL) fell 6.3%.
• Block (formerly Square) decreased by 5.6%.
• Visa and Mastercard declined by approximately 2.8% and 2.9%, respectively.

Analysts have offered mixed views on the impact of JPMorgan's new fees. Evercore ISI analysts suggested that the potential new expenses were "far from a 'business model-breaking' cost increase," while Morgan Stanley indicated that any impact would be "negligible," especially for large fintechs that rely more on debit, credit, or stored balances than bank account pulls for transactions.

JPMorgan's decision to charge fintech companies for access to customer data marks a significant shift in the financial industry's approach to data sharing. As regulatory discussions continue and the fintech sector adapts, the balance between ensuring data security and fostering innovation remains a central challenge.