Dwolla Launches Open Banking Via Its Plaid Integration

Account-to-account payments provider Dwolla Inc. has launched an integration to open-banking platform Plaid Inc. The integration is expected to enable Dwolla users to verify accounts and check account balances in real time through a single vendor and application programming interface.

Dwolla announced its partnership with Plaid late last year.

The integration offers access to open-banking services integrated with pay-by-bank methods, such as the automated clearinghouse and RTP and FedNow networks. Enabling opening banking through a single API reduces technical overhead and vendor-management complexities, Dwolla says.

Market-research firm Branded Research Inc., which pays consumers for their opinions about products and companies, was the first to pilot the Plaid API, using it to verify user accounts prior to initiating payment. The API access enabled Branded Research to reduce the complexity of account verification, which freed its staff to perform other tasks, the company says.

Dwolla plans to enhance its integration to Plaid through the addition of other Plaid features, such as Plaid Signal, a machine-learning risk engine that analyzes ACH transactions in real time to predict the likelihood of returns. Other Plaid features to be added include identity data and expanded transaction insights.

In addition to the Plaid API solution, Dwolla and Plaid can enable open banking through Dwolla’s Secure Exchange Solution, which allows Dwolla users to maintain a separate contract and API integration with both companies.

“This integration streamlines our clients’ infrastructures and accelerates their ability to innovate, and it’s now fully available to clients,” says Dave Glaser, Dwolla’s chief executive, in a statement. “In partnership with Plaid, we’re providing a scalable, robust solution that can transform the way mid-to-large organizations manage and execute financial transactions.”