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Stripe Financial Connections
- mooreds 4y agoPlaid gets its market validated!
- nitsky 4y agoIs this good news or bad news for Plaid?
- kadomony 4y agoCompetition is healthy. Whether it's good or bad, we'll see. No one can divine that, but I get the sense that Plaid's product team is a bit worried right now.
- nitsky 4y agoI wonder why it took so many years for Stripe to start competing in this area.
- cj 4y agoOne possible reason is that ACH payments are MUCH more user friendly if they can be initiated by an end-user authorizing their bank account (compared to digging up their account #, routing #, etc and entering the info manually). ACH payments are essentially free to process (or a very small flat fee). This is very different from credit card transactions that charge a % of the entire transaction. If ACH / direct payments from bank accounts became more common through services like Plaid and Stripe's new service, it could mean less fees (less revenue) for Stripe to collect. Which could explain why it's not something Stripe jumped into earlier. TLDR: if I had to guess, there's more money in processing credit card payments, and much less money in facilitating ACH transactions.
- FintechRisen 4y agoI think this is the biggest thing here. User credentials need to be protected and hopefully this type of open-market approach brings about more democratization of data.
- axg11 4y agoThis is bad. Stripe doesn't have to provide the best service here. A lot of companies already use Stripe making the barrier to trying this out very low. Likewise for startups, if you're already trying out Stripe billing for your MVP you're more likely to use another Stripe product than to try out Plaid.
- kadomony 4y agoI'd agree. A startup looking to use Stripe Atlas now has access to this for standing up their services? Plaid is basically disqualified from the start, given how cohesive the Stripe platform is.
- astlouis44 4y agoYeah exactly this, Plaid is probably in for a rough ride long term. Stripe will likely steamroll them.
- twelve40 4y agoi think it actually does. Connectivity is important, and if connections break often, then fintech will look elsewhere. It's not a matter of which color is a button, users get pissed off and leave. So the connectivity better be good.
- purple_ferret 4y agoMaybe the DoJ will allow Visa to make another offer with all the comp Plaid is getting
- zinekeller 4y agoQuestion: are US banking really this dysfunctional? Where I'm from, a bank consortium already provided unified login services (while banks still have their own websites, as a merchant you only need to integrate the consortium-provided APIs rather than using Plaid) simplifying things.
- rglover 4y agoYes. Some banks still run COBOL behind the scenes here.
- yohannparis 4y agorunning COBOL behind the scenes have nothing to do with an easy API access and a consortium for interbanking.
- rmbyrro 4y agoMaybe they pointed out as an indication that some financial institutions in the US are not modern technologically speaking, and that may be a cause for lacking better APIs?
- ericmay 4y agoThat was probably the intention but I think that isn't a core reason. It's more about business/tech incentives around these APIs. The industry is more risk-averse, and frankly there isn't necessarily a great business case for doing integrations if you're a big bank because you don't want to be commoditized into "pipes" and then have to compete on low-margin products all the while the middle companies have better margins and skim off the top of you. At least on the consumer side. There's this meme that banks are technologically backwards and all that, and I don't think that is true or a good frame of reference to have. The scale, complexity, regulatory environment, and risk-aversion when something bad happens are far and away more relevant factors than technology is.
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- yohannparis 4y agoMy question is does this use banks own API, or works like Plaid by doing web-scrapping? I'll prefer the former.
- illnewsthat 4y agoFrom https://stripe.com/docs/financial-connections/fundamentals#how-stripe-links-financial-accounts https://stripe.com/docs/financial-connections/fundamentals#h... > With the authentication flow, your user logs into their bank either through an OAuth (bank-hosted) or non-OAuth flow to authenticate access to their accounts. > Stripe generally defaults the authentication flow to OAuth if available at the financial institution. Your integration doesn’t need to treat OAuth accounts differently than non-OAuth accounts.
- naiwenwt 4y agoPlaid moved away from scraping years ago, most integrations these days are through APIs.
- amonroe369 4y agoNo they didn't. November 2021 was not that long ago. "You may be a Class Member if you are a United States resident and you connected a financial account to an app between January 1, 2013 and November 19, 2021.... "This class action alleges Plaid took certain improper actions in connection with this process. The allegations include that Plaid: (1) obtained more financial data than was needed by a user's app"
- naiwenwt 4y agoHence "most integrations", not all. Citing a settlement date range with language like "may be a class member if you connected a financial account to an app" doesn't really refute my point.
- amonroe369 4y agoIf I put up a captcha on my OLB/MB login portal, I can stop most plaid traffic because it appears as RPA activity, which would be screen scraping. AND we have one of those Bank API's built that those Plaid shills are talking about. Theres only two reasons Plaid would keep screen scraping. 1) They are still selling data to third parties or providing insights on data to third parties. 2) it is cheaper for Plaid to screen scrape than API.
- kadomony 4y agoPlaid has left the chat.
- ianstormtaylor 4y agoIf Stripe can leverage their banking relationships to leapfrog Plaid by integrating directly with bank's APIs instead of doing screen scraping... that would be massive! It seems like Plaid's biggest weakness is the flakiness of their connections, which creates so much frustration/churn downstream. Plaid's other weakness is their opaque, enterprise-style pricing, which is seems like Stripe is doing away with. Hopefully they can bring the price down, because lots of consumer-facing use cases aren't viable due to the high monthly price per connection. I hope they add support for investment account holdings—it seems like Plaid is the only one that does this well. — Edit: digging deeper, it looks like Stripe proxies to Plaid-like "service providers" under the covers—at least for institutions without OAuth flows. [1][2][3] Presumably they'll build in-house connections over time, but it dents my hope that their connectivity will be better than Plaid's. Either way, transparent pricing and more competition in the space is still welcome! [1]: https://support.stripe.com/questions/what-is-the-relationship-between-stripe-and-stripe-s-service-providers https://support.stripe.com/questions/what-is-the-relationshi... [2]: https://support.stripe.com/questions/how-does-stripe-limit-data-use-by-service-providers https://support.stripe.com/questions/how-does-stripe-limit-d... [3]: https://support.stripe.com/questions/who-will-obtain-my-financial-institution-login-credentials https://support.stripe.com/questions/who-will-obtain-my-fina...
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- transportgo 4y agoThe currency and account names used in the demo seems to be localized. I get kr and olanordman (johndoe in the US?) on my Norwegian IP device If it gets peoples attention like it did mine maybe it’s worth the dev time to implement?
- dylan604 4y agodemo names as a service. you send your locale, we send you the localized john/jane doe names and other info like 123 Main St and 555-1212 type data.
- zerocrates 4y agoJane Diaz is the name in the US actually.
- peter_l_downs 4y agoVery excited for this. One of the major issues with Plaid is their poor support for commercial banks -- for instance, SVB. If Stripe can provide more reliable connections to commercial banks, this will be an extremely valuable alternative.
- mtrap 4y agoDoes anyone have a view on whether Finicity, MX, Yodlee, or anyone else does a better job with commercial/SMB bank accounts?
- frankjr 4y agoLet me just say Stripe's design team is doing an absolutely amazing job.
- rvz 4y agoSomeone has been studying a great business leader on a strategic level (as well as a design level). Stripe: 'We have always been shameless about stealing great ideas'
- sergiotapia 4y agohttps://twitter.com/pitdesi/status/1521906115914526721 https://twitter.com/pitdesi/status/1521906115914526721
- cagr 4y agoNot a good look, the lawsuit is going to be interesting for sure.
- oyashius 4y agoFinicity has a subpar UX compared to Plaid, especially considering reliability of the connections. Unless Stripe builds its own screen scraping, this imo is a worse product.
- whockey 4y ago[]
- 88913527 4y agoIt's probably financially optimal to put a nice veneer on an existing solution than to make something whole-cloth. They're running a business, not a charity, and besides -- as the consumer, why would you care? All you see is the facade anyways; unless you're making a point that the API's are actually leaky abstractions and the facade isn't that good (and I would respect that argument, if it were the case).
- whatshisface 4y agoIf Stripe knows how to pay developers appropriate salaries (this is the under-discussed reason for SV companies being the only ones who can make good APIs - BoA is never going to pay their web team more than they pay their web team's department head, that is not possible for their culture) to develop appropriate interfaces on things, then more power to them if they can do very simple things to profit in the context of the oversights of other companies.
- astrange 4y agoI've wondered why Stripe and Square are more successful than their older competitors, considering they don't have a moat and there's nothing particularly special in the space for them to invent. It seems like it is just that the older companies aren't willing to try to improve.
- lambda_lord 4y agoThis kind of comment throwing shade on your competitors does not reflect well on you or your companies. People want alternatives to Plaid. How do you know they are simply wrapping 3rd parties instead of building these deep integrations themselves?
- stu2b50 4y agoYeah, have to say, the level of knee jerk defensiveness here and on Twitter from cofounder level figures from Plaid does not exactly evoke confidence in their ability to outcompete.
- vincentmarle 4y agoPlaid CEO has some words for Stripe: https://twitter.com/zachperret/status/1521898404061716480 https://twitter.com/zachperret/status/1521898404061716480
- ergocoder 4y agoBank provides API in order to have multiple service providers Does Plaid think they are the only one who is allowed to use Bank APIs? Anyone who uses that is considered as copying Plaid? Plaid's CEO sounds like he is so angry he didn't know what to do.
- cagr 4y agoRyan Breslow vindicated again...
- tomatowurst 4y agoI'm genuinely worried for that guy. He's exposing powerful connected people and I can't really see that end well. It's not like people retweeting and liking his tweets have any sort of power like what is alleged.
- msoad 4y agoIn case tweet disappears: > Wow! Jay, you took interviews with Plaid & asked probing questions multiple times over the past few years, and your team sent repeated RFP's (under NDA!) to us asking for tons of detailed data. I wish y'all the best with these products, but surprising to see the methods.
- stu2b50 4y agoI’m surprised they had this information so easily at hand. How did they even know that? They saw the tweet and the first thing that comes to mind is to query all the people they’ve interviewed?
- lambda_lord 4y ago
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- mrlase 4y agoThe pricing here seems asinine. $0.10/successful API call?
- wmf 4y agoThis data is worth far more than 10 cents.
- kaiuhl 4y agoI work at one of the companies that integrated Financial Connections during its beta, moving from Plaid Auth. We use the link to bank accounts for instant account verification and as a fraud signal for ACH payments. However, we definitely can’t do a better job than Stripe could at risk analysis, provided they had access to metadata on the bank account when processing the payment and could provide insights from their entire platform. Now they do. I’d guess the big benefit here, besides taking some of Plaid’s existing customers, is what’s possible now that Connections lives alongside the other things Stripe offers like ACH, loans, and identity verification.
- kintalo 4y agoThe limit to only daily pulls and up to 180 days of historical data is pretty disappointing. Would expect Stripe to push the envelope here and move down to near-instant updates and full historical data. This is basically a knockoff of existing solutions done at par or worse which is surprising to see from a company like Stripe. Maybe they've lost a bit of their magic or focus. Will be interesting to see how everyone adapts and improves to this announcement.
- twelve40 4y agosince they are heavily based on existing aggregators, they are limited by the lowest common denominator (if a good chunk of e.g. Yodlee-scraped credit unions only support 180 days, then that's a limiting factor for everyone). I would expect they will gradually improve and cut out other aggregators and replace with direct connections that have more & better data as they go along. Or maybe not, because with Oauth they then become at the mercy of the bank that issues the token (banks can revoke tokens or attach individual conditions on what data is accessed and how much). It's not an easy business to be in.
- jasonhoch 4y agoBy clicking "Start Now", I try to visit https://dashboard.stripe.com/financial-connections/application https://dashboard.stripe.com/financial-connections/applicati... and it redirects me to https://dashboard.stripe.com/test/dashboard https://dashboard.stripe.com/test/dashboard. Would love to see more! Although, from reading the docs, a lot of the products that I'm interested are still "Coming Soon" (confusingly a different verbiage but identical in meaning to "Private Beta"?): - Transactions - Other data-powered products
- edwinwee 4y agoAh, is your Stripe account live (i.e. in livemode with payments activated)? We'll look into make this smoother, but right now you'll have to leave testmode to continue.
- aristidb 4y agoCurious that they translated it to German based on my phone settings for a product that only supports US banks? (I don’t mind that it is US banks, just… why did they pay a human to translate it?)
- g-unit33 4y agoDo banks not sue these companies for scraping?
- boringg 4y agoIs this logic right or wrong: All of these fintech companies allow for more convenient movement of money and integration with applications etc however they are adding additional costs to all transactions. I.e. were trading convenience for cost?
- jollyjellie 4y agoI have been an advocate of Stripe but today I am quite disappointed with Stripe. Is this what happens when a company becomes big with thousands of employees? Copying smaller companies' product(s) while having a "partnership" with them? I wish they released an actual competing product, not a copy. This discourages SO MANY startups.
- wmf 4y agoan actual competing product, not a copy How many ways are there to do this?
- tomatowurst 4y agoguessing this doesn't work with Canada
- propogandist 4y agoif you've ever used Yodlee or a similar "verify your bank" service, change your bank account password and you'll start seeing a surge in "suspicious login attempts" alerts (if your bank notifies you of such things) as these data scraping services are constantly trying to check-in on your personal financial activity
- theyknowitsxmas 4y agoOnly available in the US.
- cercatrova 4y agoI wonder how this compares to Column, since the founder of Column also cofounded Plaid. I see both founders' comments in this thread it looks like but the Column founder doesn't seem too happy about it [0]. There also seems to be some vindication by the Bolt founder, based on his Twitter thread about how Stripe handles corporate development [1][2], it really reminds me of Paul Graham's essay not to talk to them, lest the same thing happen to you [3]. [0] https://twitter.com/pitdesi/status/1521915016668090368 https://twitter.com/pitdesi/status/1521915016668090368 [1] https://twitter.com/theryanking/status/1485784823641755648 https://twitter.com/theryanking/status/1485784823641755648 [2] https://twitter.com/pitdesi/status/1521906115914526721 https://twitter.com/pitdesi/status/1521906115914526721 [3] http://www.paulgraham.com/corpdev.html http://www.paulgraham.com/corpdev.html
- healthbjk 4y agoColumn is a bank. They've bought a bank charter and are aiming to cut out Banking as a Service middlemen
- philip1209 4y agoYeah - my impression is that Column is depth-first for the US banking system, whereas Stripe is breadth-first for multiple markets
- metadat 4y agoSee also: https://news.ycombinator.com/item?id=31263288 https://news.ycombinator.com/item?id=31263288 "Stripe releases Plaid-like project, Plaid CEO objects to process" Different day, same old stripe. Beware.
- Brystephor 4y agonot a different day. that post is from 3 hours ago.
- metadat 4y agoI meant that today is a different day from yesterday, and the day before.. It's a common English idiom. I don't have the reference links handy but the TL;DR is that Stripe has played dirty lots of times before. The formula is: 1. Pretend they want to acquire a company with a product they like 2. Then, once they waste enough of the competitors time (buying buffer enabling them to figure out the secret sauce) 3. Clone stamp the competitors product, fucking them over royally. Also leverage the tremendous public reach, visibility, and clout of Stripe itself to promote their clone. It's a very ugly and distasteful way of doing business. It aligns with the values of the Farenghi on Star Trek. It's naiive on the victims part, sure, but Stripe is dishonest and shan't be trusted.
- iamcreasy 4y agoI do not know about other instance. Could you please share?
- metadat 4y ago"Stripe hiring issues make some lose job offers" https://news.ycombinator.com/item?id=29403976 https://news.ycombinator.com/item?id=29403976 I think I was confused, and I apologize. There was some prior drama with the Bolt founder claiming Stripe was colluding against them. It seems an error on my part, an honest one but still incorrect. Sorry, again.
- willswire 4y agoGlad to see a Stripe alternative to Plaid.
- a13n 4y agoDoes it collect your bank username and password, or work directly with banking APIs? Every time I see some service trying to do this via Plaid I cringe.
- bm5k 4y agoYeah, giving out my banking authentication info is a hard nope for me & I discourage everyone I know from using or implementing anything using plaid.
- lambda_lord 4y agohttps://stripe.com/docs/financial-connections/fundamentals#authentication-flow https://stripe.com/docs/financial-connections/fundamentals#a... You log into your bank directly and then grant access to Stripe. I presume, behind the scenes, your bank gives Stripe a single application token (not your credentials) to pull read-only data. (edit) But this is only for banks supporting Oauth, it seems for others it DOES give Stripe your credentials.
- slugiscool99 4y agoHow much longer are we just going to keep eating up whatever the Stripe PR machine churns out? They did a great job with payments but a lot of their auxiliary products are just worse versions of other businesses.
- psanford 4y agoSo could I use this to build a personal tool to track account balances over time?
- kintalo 4y agoYes, you could. You would be limited to 180 days of history on initial pull and your data would always be up to 1 day behind. Otherwise, yes, you could. It doesn't really feel like this product is aimed towards aggregators or dashboard and more for underwriting and bank account validation.
- nope1234 4y agoI honestly can't believe that there's enough people dumb enough to give their bank username/password combo to strangers to make services like this work. Nope nope nope. As a user, I'd never use any service that is plaid based, I don't even care that "they have proper api access now". Even though I've been fan of other stripe offerings I'd never use this either. It's beyond shady. Friends don't let friends give out their banking creds.
- lambda_lord 4y agoThat's not how the service works. You don't give Stripe your banking credentials, you log into your bank directly: https://stripe.com/docs/financial-connections/fundamentals#authentication-flow https://stripe.com/docs/financial-connections/fundamentals#a...
- wmf 4y agoNo, it looks like you're logging in to your bank but you're actually giving your credentials to Stripe.
- lambda_lord 4y agoIf your bank supports Oauth it won't share your credentials: >Stripe generally defaults the authentication flow to OAuth if available at the financial institution....OAuth is an open standard authorization protocol that allows users to let applications (for example, Stripe) access their information within other applications (for example, bank apps) without having to share their login credentials. But for banks without Oauth you DO give your credentials to Stripe: > For these banks, end users provide credentials to Stripe or one of our trusted partners.
- astrange 4y agoIs there even a single case of this actually going badly?
- twelve40 4y agothere are at least 100 million people who've used Plaid alone, not to mention other aggregators (MX, Finicity, Yodlee, etc) like it or not, it is a mainstream thing by now. plus, as others have mentioned here, with oauth-enabled banks the aggregators just get a temporary token. https://www.protocol.com/fintech/plaid-lawsuit-settlement-open-banking https://www.protocol.com/fintech/plaid-lawsuit-settlement-op...
- darylteo 4y ago@edwinwee will this roll out to Australia eventually?
- edwinwee 4y agoWorking on it!
- _mmgc 4y agoSeems like a shiny repackaging of Finicity/MX.com with little value added. I don't see any reason to recommend this product to anyone. Or maybe they're targeting a different market. This solves exactly none of the issues I've had working with almost every bank aggregation API on the planet (Yodlee, Plaid, Finicity, Tink, Nordigen, Belvo). And boy, do they have issues. As the founder at [name-redacted] (personal/SMB finance plugin), I deal with bank connection issues on a daily basis. - Screen scraping is 1. flaky and 2. insecure because it requires saving credentials and is 3. not realtime and 4. doesn't work with 2FA. Account balances can be out of date within minutes, and cannot be refreshed without another auth - 95% of banks on the planet don't have OAuth APIs. The 5% that do have APIs that often don't serve customer needs because they provide the absolute minimum amount of data to meet the requirement. For example CapitalOne's API only provides access to 90 days of data. American Express does not provide access to invoice metadata, which makes reconciliation hard. Who can provide dedicated direct screen-scraping connections to banks with all the data that users want? - When building a generic fintech product (as I do), global bank coverage is essential. The least bit of innovation Stripe could have done was save me the trouble of having to integrate 5 different APIs to get access to US, European, Latin American and Australian banks. - In the same vein, connection to 90% of accounts is useless for many users if they can't access the other 10%. The number one need for financial planning software is "to see all my accounts in one place". Most people have at least one account with some obscure institution or overseas bank. If they can't see all their accounts in one place, this isn't solving the problem. - This is just an API without a GUI dashboard. Another common complaint I've heard from my leads that Plaid/Finicity is only for programmers, or companies that have programming expertise. What if you're a marketing firm with need for no-code bank data visibility? - Only 180 days of transaction data and no statements? This is much worse than Plaid and Finicity. I guess it's nice if you can verify ACH details faster, but even then the coverage is worse than Plaid, and so I don't see any reason to recommend this product to anyone. Zero innovation and objectively worse than the current offering? Who is the target market here?
- nicksiscoe 4y agoThe target market (for now) is probably their existing customers looking for better risk management by checking balance data through an authentic bank connection before initiating transactions through other Stripe products they already use. I’m sure Stripe’s hope is that this becomes a full-blown Plaid killer, but as you mentioned that’s certainly not yet the case
- seenit 4y agoHostile integrations using scripts to obtain financial data is trivial. Frameworks such as: https://github.com/teampoltergeist/poltergeist https://github.com/teampoltergeist/poltergeist is an excellent example of such a framework. Implementing "bank drivers" using such frameworks would not be difficult. Plaid and others seem to have done an awesome job scaling the hostile integration pattern. However, the idea that Stripe decided to build this in-house rather than rely on Plaid is perfectly reasonable. After all, the tools to implement such a product are well known.
- NorwegianDude 4y agoWell,it's not always trivial. I'm not even able to log in to anything important without multifactor authentication that is either a hardware OTP of some sort, or using a private key stored in my SIM-card that is accessed with a pin. It's doable if you really want to, but it's much more of a hassle that just running a script. Definetly not doable at scale, for better or for worse.
- dakev 4y agoI agree that building in-house integrations is superior to relying on a 3rd party - it's always better for the end user when their sensitive information doesn't have to jump between multiple companies. However, by their own admission (https://support.stripe.com/questions/what-is-the-relationship-between-stripe-and-stripe-s-service-providers https://support.stripe.com/questions/what-is-the-relationshi...), Stripe did not build any scraping integrations in-house. They in fact, do rely on third parties. According to one of their PMs, Edwin, elsewhere in this thread, they supposedly integrate directly with banks that already have existing APIs - but for the 95% of banks that don't, it appears this product is just a wrapper for existing aggregators MX and Fincity.
- InTheArena 4y agoWelcome to the USA. Rather then adopt something like OpenBanking, it's now a walled garden for-pay service from a valley startup. https://developer.barclays.com/open-banking https://developer.barclays.com/open-banking
- xvilka 4y agoIsn't OpenBanking only UK-specific? But I agree with you, settling for a global standard would be a perfect solution. Success of SWIFT clearly shows that.
- jimmcslim 4y agoI hope they plan to leverage the "Consumer Data Right" Open Banking APIs in Australia... so far the roll-out has been disappointing, there aren't any decent PFMs in Australia that use APIs rather than crappy Yodlee screen scraping, and I'd like to program against a decent API to pull my own bank data thanks.
- desmondrd 4y agoThis is a plaid killer. This specifically is such a dig against plaid’s obfuscated permissions model. “ Before linking an account, users can see: What types of data they’re sharing Who can access their data How to disconnect an account
- xvilka 4y agoI wish more countries would be supported, like in PayPal. For example, Asian and Middle Eastern banks largely aren't supported. Same you could tell about African banks.
- instaranq 4y agoPlaid, Stripe etc are not the only way to get transaction information as well. Fidel API provides developers with real-time access to card transactions with user consent directly from the networks.
- gunapologist99 4y ago> "We safeguard users’ data by.. Limiting your access to only the data you requested" Left unsaid: Stripe gets access to everything, just like Plaid?
- thedangler 4y agoAnyone here know how fast ACH transfers are from one account to another? Is it same day 3 business days? I'm in Canada but I can use this to build something for my US clients. But if it's not same or next day, I can seem my clients not wanting to use it.