Plaid, a platform that helps lenders pull consumer-permissioned bank data into their systems, on Thursday announced that it plans to compete in the market for similar arrangements involving payroll data.
The company is beta testing a product called Income, which facilitates consumer-permissioned reviews of data from payroll providers. The company is also in talks with ADP about a possible business partnership.
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“The potential in mortgage is quite high,” said Kate Adamson, a product lead at Plaid.
The fintech has had discussions about testing its new Income technology with the GSEs and is already piloting its use for other purposes with mortgage lenders, she said.
For instance, the technology can already be used to facilitate access to payroll documents that the GSEs require in loan submissions, Adamson said. Also, portfolio lenders may use consumer-permissioned payroll data to evaluate loans.
At least one mortgage lender, Veterans United, has gone on record as being in the test group for Plaid’s Income technology. Other types of lenders in the test group include Carputty, a company that facilities auto financing, and MYRA, a personal finance platform aimed at serving immigrants. The product could also be used in conjunction with apartment rentals.
To test the technology in the mortgage space, Plaid embeds a link in the loan application on a given lender’s point of sale system. That link then connects to an interface that allows a consumer to grant permission for data to be pulled from their payroll systems, Adamson said.
Because Plaid also provides bank data integrations within such systems, it can store some of the information from one inquiry in such a way that the consumer goes through a more efficient process when the second inquiry’s run, she said.
Plaid’s tests to date have been run only through access consumers have to their payroll data, but if the talks with ADP bear fruit, data sourced directly from the latter could be in play.
“ADP and Plaid are actively working towards a partnership around consumer-permissioned payroll data that will enable consumers' credential-less access to their payroll details using ADP's API,” said Meraj Mohammad, vice president, ADP Ventures, in a press release.
