J.P Morgan has told financial technology companies they will be barred from accessing its customer information by July 30 unless they sign data access agreements with the bank and back a plan to stop using customer passwords to gather the data.
The bank set the new deadline in a letter sent to the companies in late January, in which it said they must agree to a “concrete plan” to transition to a new method of collecting customer data, according to two people familiar with the matter who spoke with Reuters.
Otherwise, J.P. Morgan will block all automated access to the data, including through so-called screenscraping, or the process of collecting data from one application to use it in another, the people said. A J.P. Morgan spokesman confirmed the contents of the letter and said the company already had agreements covering more than 95% of data access requests.
The deadline is the latest move in the bank’s effort to transition fintechs and data aggregators to what it has said is a more secure way of accessing customer data. The new method means fintechs will not be able to use customers’ passwords to access their entire financial data, but will instead connect to a set of bank programming code known as an API, that grants access only to limited account information authorized by the consumer.
The transition comes as large banks and fintech companies globally tussle over data-sharing. Banks have said their wariness to grant access to third parties stems from a need to protect highly sensitive information, such as transaction history and income. Fintechs have been skeptical, arguing that it should be up to consumers, not banks, to decide what companies can look at that information.