Following a successful trend, Plaid released the second of a suite of products to come under the Plaid for Payroll brand. Aimed at “the next frontier for fintech and open finance” the new products will be delivering payroll data to unlock new applications and improve consumers’ financial lives. It is the company’s latest step in broadening its reach as consumers and enterprises increasingly adopt fintech for all elements of their financial lives.
With this new payroll product, Plaid Income, lenders will be able to access a consumer’s permission income data “straight from the source” in order to make “better-informed risk decisions, issue pre-approvals or approvals faster, and allocate fewer resources to manually reviewing documents” according to the company statement. The understanding is that streamlining what is often a laborious process of aggregating payments and income data for loan applicants, people will be able to live healthier financial lives sooner.
This release comes after Plaid and Visa’s mutual termination of their much-publicized deal. Plaid appears to be moving on swimmingly, pursuing the latest hot topic of payroll in fintech. In January, Plaid launched Deposit Switch, its first payroll product which automates direct deposit account funding for fintechs and banks that embed Plaid into their onboarding flow. The company makes a big case for pursuing payroll data in its products, as the financial data contained in payroll is critical for helping consumers get the full picture of their finances to help them acquire loans, find better rates, and even optimize earnings from multiple income streams.
Plaid is leading the way by recognizing the importance of incorporating payroll into its financial services in order to make fintech accessible to all levels of a consumer’s financial needs. The product has been in beta testing with the final product aiming to allow users to both connect their employer or payroll provider account or directly upload documents including pay stubs, W2s, and supported types of 1099s.
Speaking on this product Jake Ford, an early beta tester and product owner of Veterans United Home Loans said, “Plaid’s consumer-permissioned Income product helps reduce the paperwork and overall closing times for borrowers, while improving efficiency and information accuracy for our lending teams.”