Investor Advice for Fintechs
March 27, 2023 | 2 min read
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May 7, 2021 | 0 min read
Every year, MX has a tradition of bringing together our partners and customers in an intimate setting to share insights into the state of the financial industry, MX product updates, and our current roadmap.
This year, Brandon Dewitt, CTO and co-founder of MX, kicked off our Product Forum discussion with a warm welcome and a message of why it’s more important than ever before to double down our efforts in empowering the world to be financially strong.
Dewitt states, “Much has changed over the past year, but our mission to empower the world to be financially strong has remained the same. In fact, with the changes brought about in the last 12 months, we feel that it’s a stronger priority than ever before. Trends changed, habits changed, and ultimately the world changed. Our industry rose to the challenge, bringing new solutions to market that made accessing and interacting with our finances easier than ever before. Today, we want to share some of the highlights from the past few months and a glimpse into MX’s future as it applies to connectivity.”
3 Top Highlights from the MX Product Forum
1. From Screen Scraping to Tokenized, Credential-free Connections
— Brett Allred Chief Product Officer at MX
Allred talks about the advancements we’re making in product at MX. He states, “As many of you know, MX is advancing how modern data connectivity and open finance can improve the customer journey. We create tools and solutions that can help you deliver better product experiences that increase engagement and user satisfaction, while allowing you to hit your financial business objectives. Whether you need to gather more user financial data, enhance and better utilize the financial data you already have, or increase the speed to market with web and mobile financial experiences, we can help with intelligent and personalized solutions that set you apart.”
He goes on to say, “Our solution touches across three main pillars: connectivity, data, and experience. Today, we’ll be focusing on connectivity. We look at connectivity or aggregation in two ways; legacy and modern. Legacy is scrape-based connections, and while that’s still an important method today to ensure coverage, MX is now moving to a more modern approach to connectivity. We define modern connectivity as tokenized, credential-free API access that is built with the highest security standards. This provides customers with the best experience while interacting with your products. Our platform intelligently routes customers to the best connectivity experience and provides the ability to approve, manage, and revoke access to their financial data.”
In looking from the present to the future, Allred says, “Today, many of our customers are experiencing more than 50% of their traffic through direct connections, and our objective is to have 85% of our traffic through tokenized connections by the end of 2021.”
— Jane Barratt, Chief Advocacy Officer at MX
Barratt starts off her presentation by explaining how connectivity is powering open finance. She states, “Open banking is powering more and more retail use cases — from budgeting and lending to payments — where data is securely accessed and shared via APIs. We are now moving towards open finance where broader use cases like tax and investments provide even more utility. And then there’s embedded APIs and platform banking, where APIs will drive totally new use cases including providing financial services within other industries such as uber money and google cash.”
When it comes to connectivity, Barratt says, “There is a profound shift going on in the industry away from the monetization of people's personal data. MX was never in the business of scraping data from point A and selling that raw data to point B. When a customer permissions us to access and share their data, we have always optimized our platform to go with the most complete, most secure source — only using that data in the way the customer intended.”
With API-based data sharing Barratt says the benefits for consumers are wide ranging. “The controls that have been put in place around customer permissions will now be in the hands of the customer,” she says. “These open banking APIs give consumers visibility into where data is going as well as the ability to revoke consented access at any time. It also brings control into the hands of data providers, issuing tokens with specific data fields for specific use cases that have customer permissions, vs. screen scraping where all data points are shared. We have strong belief that regardless of where someone chooses to bank, borrow, transact or make payments, they should be able to securely access, and transparently share their financial information. And it’s our commitment to accelerating that great experience for everyone with Portal — an open-source, open-standard solution to help bring credential-free API connections to consumers faster.”
— Shayli Lones, Director of Product Marketing at MX and David Whitcomb, VP of Connectivity at MX.
Lones dives into how we’re advancing our products with modern connectivity. She states, “In order to make better, more informed, decisions about their finances, consumers need to have real-time, secure and reliable access to their financial data. MX is helping the industry move away from legacy approaches and associated risks, to a more secure and enhanced experience. Our Open Banking API Portal is helping institutions, regardless of size, enable and deploy their own credential-free API connections. We’re making it easy to accelerate open banking with an open source platform because we believe that modern connectivity is the future data sharing.”
She goes on to say, “In order to truly embrace the future of open finance and open banking, it begins with enabling consumer permissioned data sharing. From better user experiences to higher transparency, when consumers have access to their data, they benefit from a wide variety of financial services. These connected experiences help organizations by allowing them to deliver more relevant offers, intelligent financial management tools, and safer ways to connect account information, which all lead to a better digital banking experience.”
Whitcomb gives four examples of advancements that streamline and improve the connectivity experience for customers.
Whitcomb says, “MX’s verification solution, surfaced through our Connect Widget, automatically routes the user to the best connection type and verification method available for the institution they select, from direct APIs that connect in under 10 seconds, legacy connections, and very soon micro-deposit verification, all from our Connect Widget. All of our methods of verification are in accordance with NACHAs 2021 rule so the account number, routing number, can be used for your customer’s ACH processes.” He goes on to say, “The intelligent routing in modern connectivity makes verification for account number, routing number, balance, name, address, and other identity information almost instant.”
Here, Whitcomb highlights that “we’ve expanded our connections to over 4,000 institutions providing coverage to the long tail of smaller institutions. MX has instant verification in this area with connections in under a minute instead of days, and most of these connections are under 30 seconds.”
When looking ahead, Whitcomb says, “we’re excited to announce that in just a couple of months, MX will provide account verification to the institutions that aren’t available through instant account verification. Our Connect Widget will automatically route users to microdeposits at the institutions where instant verification isn’t available. This means, with a routing number and an account number, customers can connect to their accounts anywhere they are. Here the user will be asked to enter their routing and account number instead of their credentials and it will trigger a pair of microdeposits, and when received, they will then return to verify receipt of the funds. With this approach to verification, you can be assured that your customers will have uninterrupted access to their accounts.”
"For the innovative institutions that currently have a world-class mobile experience” Whitcomb says, “we can work alongside your digital app and provide App-to-App authentication and biometric login.” The way it works, Whitcomb says is that “when a customer chooses to connect their account to an app powered by MX, they will be directed to the mobile app of their FI to sign in using biometrics. Customers will be asked to confirm that they want to authorize access using the institution's mobile app biometrics. Once confirmed, the customer can then use Touch ID, Face ID and Iris ID to instantly connect their account.”
Want to see more about what we have planned on our future road map? Join us at Money Experience Summit in September.
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