Data sharing

American banks need the kind of clear rules European institutions have enjoyed for several years if they're to become leaders in sharing consumer data with fintechs.

Vendors including Akoya, Plaid and MX are trying to help banks manage and view their application programming interfaces through data portals as an alternative to scraping consumers’ login credentials.

The bank's technology team was trying to figure out how to develop a system similar to the respected software program of Brown Brothers Harriman's investor-services unit. Now that State Street is buying that same unit, it can drop the project.

The U.S. and its neighbor to the north are each developing frameworks to give consumers control over financial data and allow companies to transfer account information. A recently issued Canadian government report could influence efforts in both countries, analysts say.

The size of the financial commitments was not disclosed, but they add to a $425 million fundraising round that the data aggregator announced earlier this year.

The San Francisco data aggregator has committed to minimizing how much data it extracts from bank accounts.

Banks should favor the development of U.S. data rules that let them freely share consumer information with, and receive it from, fintechs. The alternative, where banks merely send data to third parties for a fee, would be less competitive and less beneficial for all parties.

Banks should let consumers download their account data and transfer it to other financial providers, according to a new presidential order. Some experts argue aggregators are already making this happen, but others say the directive implies more consumer control.

It's the latest move in an industry shift toward more secure sharing of bank account data with fintechs and away from screen scraping.

As the bureau writes data-sharing rules, the third-party firms that work with fintechs say oversight by the agency would be more efficient — and better for consumers — than being policed by their bank partners.