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If you use financial services like Venmo, Betterment, You Need a Budget, or Robinhood, you're one of the 1 in 4 American adults already using one of the most innovative financial technologies today: Plaid. Plaid is used to connect your bank accounts to a variety of programs and apps, and it's quickly becoming a household name.
With any software that accesses sensitive financial data, customers want to know exactly how their information is being used, and they want strong assurance that their money is safe. Here's everything you need to know about Plaid and how it keeps your banking information safe.
In this article
What is Plaid?
Plaid is a fintech company that acts as a middleman between your bank account and financial apps. When you link your bank accounts to an app that uses Plaid, Plaid takes the account logins you provide, encrypts the requested data (such as your account financial balance), and then transmits it to the app over a secure connection. Plaid obscures your login information to protect you, only transmitting the information you choose.
Plaid gives you the ability to easily link your bank accounts to over 3,000 different financial services while maintaining complete security and control through a secure API.
What is an API?
API = Application Programming Interface
An API is a function of your website or application server that works between other sites and applications. Essentially, APIs communicate with other applications to link data without leaving your site (think Google calendar links or going to your bank's website).
The Plaid API makes it easy for countless apps to link bank accounts. Developers simply request Plaid API keys, then create a free account to use those keys to securely and quickly link financial information—as consumers, developers, or curious experimenters.
Why is Plaid asking me to connect to my bank account?
Plaid connects to your bank account to create a secure connection between your financial institution and applications that require financial information. Plaid uses this connection to your bank account to retrieve any data your financial apps need while protecting your sensitive information. Plaid can retrieve data such as your account balance or account numbers needed for deposits or withdrawals, but it does so using encrypted, secure tokens to protect your actual account information.
Is Plaid safe?
Many consumers are concerned about giving access to their bank accounts, and for good reason. You want to keep your finances safe, so you may hesitate when an app asks for your bank account information. But when Plaid asks, you can connect with confidence.
One fintech founder compared using Plaid to any other online financial choice, such as shopping online on Amazon. “Every time you click an order button and implicitly trust that what you ordered will actually be delivered, you are demonstrating trust.” There is always some risk online, but users should be able to move forward with confidence.
How does Plaid support your privacy?
You have control over every detail of your personal information through the Plaid platform. You decide what Plaid can share with apps, including:
Plaid's privacy policy states that they will never sell or rent your personal information and only share data with companies you have given permission to.
How secure is Plaid?
Even when a company promises to keep your financial data private, security is still a concern. Is your data protected from cyber attacks or hacks? Plaid ensures that your information remains protected from malicious access attempts and asset and access theft.
To ensure strict security, Plaid relies on the following:
Which companies and banks use Plaid?
Who uses Plaid?
Popular Plaid Apps for Individuals and Businesses
Plaid supports over 3,000 financial apps, including several you may already use:
Chances are that any app you use that connects to your bank or credit card accounts uses Plaid — or soon will. Plaid is secure, reliable, and designed for consumers and businesses who want to make secure financial access completely hassle-free.
With any software that accesses sensitive financial data, customers want to know exactly how their information is being used, and they want strong assurance that their money is safe. Here's everything you need to know about Plaid and how it keeps your banking information safe.
In this article
- What is Plaid?
- Why is Plaid asking me to connect to my bank account?
- Is Plaid safe?
- Which companies and banks use Plaid?
What is Plaid?
Plaid is a fintech company that acts as a middleman between your bank account and financial apps. When you link your bank accounts to an app that uses Plaid, Plaid takes the account logins you provide, encrypts the requested data (such as your account financial balance), and then transmits it to the app over a secure connection. Plaid obscures your login information to protect you, only transmitting the information you choose.
Plaid gives you the ability to easily link your bank accounts to over 3,000 different financial services while maintaining complete security and control through a secure API.
What is an API?
API = Application Programming Interface
An API is a function of your website or application server that works between other sites and applications. Essentially, APIs communicate with other applications to link data without leaving your site (think Google calendar links or going to your bank's website).
The Plaid API makes it easy for countless apps to link bank accounts. Developers simply request Plaid API keys, then create a free account to use those keys to securely and quickly link financial information—as consumers, developers, or curious experimenters.
Why is Plaid asking me to connect to my bank account?
Plaid connects to your bank account to create a secure connection between your financial institution and applications that require financial information. Plaid uses this connection to your bank account to retrieve any data your financial apps need while protecting your sensitive information. Plaid can retrieve data such as your account balance or account numbers needed for deposits or withdrawals, but it does so using encrypted, secure tokens to protect your actual account information.
Is Plaid safe?
Many consumers are concerned about giving access to their bank accounts, and for good reason. You want to keep your finances safe, so you may hesitate when an app asks for your bank account information. But when Plaid asks, you can connect with confidence.
One fintech founder compared using Plaid to any other online financial choice, such as shopping online on Amazon. “Every time you click an order button and implicitly trust that what you ordered will actually be delivered, you are demonstrating trust.” There is always some risk online, but users should be able to move forward with confidence.
How does Plaid support your privacy?
You have control over every detail of your personal information through the Plaid platform. You decide what Plaid can share with apps, including:
- Account and routing numbers
- Remains
- Transactions
- Investment holdings
- Credit Card Balance and Interest Rates
- Student loans
- Account Profile Information
Plaid's privacy policy states that they will never sell or rent your personal information and only share data with companies you have given permission to.
How secure is Plaid?
Even when a company promises to keep your financial data private, security is still a concern. Is your data protected from cyber attacks or hacks? Plaid ensures that your information remains protected from malicious access attempts and asset and access theft.
To ensure strict security, Plaid relies on the following:
- Data encryption protects information coming from all sides of the transaction - from banks, applications and customers. Advanced Encryption Standard (AES) is used for any data at rest, and Transport Layer Security (TLS) protects any data transferred between applications.
- Plaid uses a cloud infrastructure that was built with security in mind, using security technologies that have been developed over decades to provide the most flexible and responsive protection.
- Multi-factor authentication (MFA) is used to protect your identity and login security, and to prevent unauthorized logins to your account.
- 24/7 monitoring allows you to get immediate support for any potential issues.
- All trusted technology companies use independent security testing , and Plaid is no exception. Plaid uses third-party testing and a bug bounty program to keep its platform in perfect condition.
Which companies and banks use Plaid?
Who uses Plaid?
- More than 3000 applications
- More than 10,000 financial institutions
- 25% of the US adult population
Popular Plaid Apps for Individuals and Businesses
Plaid supports over 3,000 financial apps, including several you may already use:
- Acorns
- Betterment
- You Need a Budget
- Robinhood
- Upstart
- Dave
- Pillar
- Venmo
- Coinbase
- Carvana
- EllieMae
Chances are that any app you use that connects to your bank or credit card accounts uses Plaid — or soon will. Plaid is secure, reliable, and designed for consumers and businesses who want to make secure financial access completely hassle-free.
