PNC Financial Services Group and data aggregator Plaid have partnered to help the lender’s customers share financial data with their chosen financial application through the fintech — ending years-long litigation between the two companies.
The bilateral data access agreement would allow PNC customers to connect more safely and securely while using third-party financial apps, the company announced Friday.
The Pittsburgh, Pennsylvania-based bank uses Akoya as its application programming interface service provider, allowing all data recipients, including Plaid, to connect quickly to the apps while enabling customers to decide what financial data they want to share without disclosing their login credentials with third parties, Natalie Talpas, executive vice president, digital and payments at PNC, noted in a statement.
“Through this new partnership with Plaid, PNC customers will be able to achieve greater data security, privacy, and control while using the third-party financial apps and services they enjoy,” Talpas said.
PNC sued Plaid in December 2020, alleging that Plaid violated federal and state trademark laws by replicating the lender’s authentic log-on screen. PNC alleged this process allowed Plaid to collect users’ account data without direct interaction with PNC.
“Plaid replicated the authentic PNC log-on screen to intentionally mislead consumers into believing that they are providing their private and sensitive information to PNC or to an entity affiliated with PNC in order to overcome the otherwise present and reasonable apprehension to providing financial information to an unknown third-party,” PNC claimed in the lawsuit.
For its part, Plaid argued that PNC knew about its use of the lender’s marks and logos as early as 2017, and both companies worked closely to enable PNC customers to connect to fintech apps more easily.
Last month, Judge Mark R. Hornak denied both parties’ motions for summary judgment and said all pending claims except fair use will proceed to trial. However, last week, he dismissed a trial start date of Sep. 16, and a settlement conference slated for Sep. 10 was also canceled, according to Bloomberg Law.
“PNC and Plaid are pleased to have resolved the claims at issue in the lawsuit filed by PNC against Plaid,” Freya Petersen, a Plaid spokesperson, told Banking Dive in an email, adding that the settlement terms are confidential. But Plaid declined to comment about the partnership beyond the press release.
PNC did not respond to Banking Dive's request for comments.
PNC's agreement with Plaid balances digital banking innovation with improved customer data security and control — a move that aims to strengthen PNC’s customer loyalty while attracting safety-focused clients and potentially boosting transaction volumes and revenues, according to experts at Zacks Equity Research.
Last December, Plaid entered into a similar partnership with Canadian giant TD to enable the bank’s customers in the U.S. and Canada to share financial data with Plaid’s network of apps and services without sharing the credentials with third parties. In October, the data aggregator collaborated with Fiserv, the global payments and financial services technology provider, in a deal to allow Fiserv’s roughly 3,000 bank and credit union clients to have a “credential-less API-based connectivity” with over 8,000 apps and services on the fintech’s platform.
“Moving the industry away from credential-based access is a top priority for Plaid, and our alignment on key principles around security, access and control played a definitive role in establishing this partnership. We look forward to future collaboration for many years to come,” Christy Sunquist, head of open finance partnerships at Plaid, said in a statement regarding the PNC partnership.
