Fiserv and MX Pair Up for Expanded Open Banking

The fast-growing field of open banking got another boost Monday when the big payment processor Fiserv Inc. announced a major industry player, MX Technologies Inc., will use its AllData Connect service.

AllData Connect is part of Fiserv’s AllData Aggregation platform that provides consumer-permitted access to tokenized financial account and transaction data held by Fiserv’s client banks and credit unions. These so-called open-banking connections allow payments providers and other financial-services players to verify the ownership of checking and other financial accounts, as well as the level of funding in those accounts, through application programming interfaces. The technology generates tokens as stand-ins for user names and passwords accessed through a common but less secure process called screen scraping, and has attracted a wide range of fintechs and other non-banks looking to facilitate payments.

A Fiserv spokesperson tells Digital Transactions News in an email message that nearly 400 financial institutions, brokerages, fintechs and other firms currently use AllData. “As the industry moves away from screen scraping and toward tokenized, secure data access, Fiserv and MX will be positioned as leaders in the space to capture growing volumes,” the spokesperson says. “The relationship with MX accelerates the ability of Fiserv to offer tokenized access to data. This will protect consumers of financial institutions using AllData from a data-security and privacy standpoint, and will protect [financial institutions] themselves from fraud exposure.”

Don Parker, MX’s executive vice president of partnerships, tells Digital Transactions News by email that MX is the first third party to access the AllConnect platform. “It speaks to the innovative nature of the two companies and the partnership we’ve formulated to pioneer and lead the way in eliminating credentials in favor of direct connections that allow for tokenized consumer data,” says Parker. “There’s a real need here, and a lot of people are talking about this, but we’re actually doing it—MX and Fiserv together are helping to move the industry forward in open finance and tokenized credentials.”

The Fiserv deal will expand Lehi, Utah-based MX’s already broad reach in open-banking. MX said it connects more than 16,000 financial institutions and financial-technology providers through its network, and serves 85% of digital-banking companies. MX claims its platform can reach more than 200 million consumers.

A late 2021 survey found that open banking was due for explosive growth in Europe and the U.S., and that it could threaten the dominance of the card networks in e-commerce. And in December, MX said it was working with upSWOT Inc. to enable small and mid-size businesses to connect their bank accounts to import transaction and account information to dashboards that allow them to view the overall health of their businesses.