Stripe has become one of the first major fintechs to formally oppose JPMorgan Chase’s Open Banking plans to charge fees for access to customer financial data, warning that the move could harm competition and innovation across the US financial services sector.
Stripe challenges JPM over Open Banking fees
In comments submitted to the Consumer Financial Protection Bureau (CFPB) and published this week, Stripe urged the regulator to take immediate steps to prevent large banks from imposing charges while the agency reviews its Open Banking framework.
The company argued that allowing such fees during a period of regulatory uncertainty would cause “irreparable harm” to both businesses and consumers.
The dispute stems from JPMorgan’s July announcement to data aggregators, including Plaid, that it would begin levying significant fees for connections to customer bank accounts.
The bank maintains that aggregators exploit infrastructure it has built at considerable expense, while fintechs argue that data access is essential for offering consumers choice and driving competition.
The CFPB
The CFPB sits at the centre of the dispute.
In the final months of the Biden administration, the agency adopted rules under Section 1033 of the Dodd-Frank Act that barred banks from charging for access to deposit and credit-card account information.
The Bureau is now consulting on revisions to the rule, with an Advanced Notice of Proposed Rulemaking (ANPR) published on 21 August.
Key areas of focus include data security, privacy, the definition of consumer “representatives” and the treatment of cost recovery fees.
Stripe’s intervention reflects growing concern among fintechs that, without swift action, the largest US banks could set a precedent of charging prohibitive fees before the CFPB finalises its revisions.
The company has suggested several possible courses of action, ranging from enforcement measures against early adopters of such fees to referrals of anti-competitive practices to the Federal Trade Commission or the Department of Justice.
“The largest banks should not be permitted to charge prohibitive fees for data access while the CFPB considers how to address those same fees,” Stripe wrote.
“Immediate action is essential to preserve a thriving marketplace and safeguard innovation in financial services.”
For the wider fintech ecosystem, the outcome of this clash could shape the economics of Open Banking in the US for years to come – a market opportunity Visa recently withdrew from.
At stake is not only the cost of data access, but also the pace at which consumers can expect to benefit from a more competitive and transparent financial marketplace.
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