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Banking question: how does Plaid verify bank accounts so quickly when the old way that most services still use had that messing around with sending 2 small deposits that had to be verified? What changed?
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Because that’s the old system, and you don’t normally share your credentials. By giving them your credentials it’s a different kind of security concern (full access vs just ACH info) and they can verify the account exists and the balance amounts and everything.
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So with your login credentials they get immediate visibility into the ACH info, balances, that the account exists at all, etc... vs ACH as a system takes multiple days for those payments to clear and thus for them to verify.
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Doing it correctly is complicated enough that nobody wants to do it. Fraud prevention is a really important factor at millions of transactions. It makes sense for the industry to just pay a third party to handle that problem for everyone. Then just up to them to start using it.
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After logging in you need to programatically navigate to the page containing the information you need, handling failures, timeouts, etc. This is bespoke to every bank, and needs to be maintained. Not many companies have the resources to do this, hence Plaid and co.
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