The US-based API brokerage platform partnered with Plaid to speed up funding of online investing accounts, per BusinessWire. DriveWealth’s API provides its 90 clients, including fintechs and financial institutions, with the underlying infrastructure to offer fractional share trading and robo-advisory products to their end users. Plaid’s API connects with 4,000 financial services clients, letting consumers link their financial accounts to aggregate their financial data in one place, ease authentication, and initiate payments.
Their combined API capabilities reduce friction in the investing process and should help DriveWealth attract Plaid’s clients. Mutual clients of both fintechs can now authenticate their end users’ bank accounts via Plaid to accelerate bank transfers to investing accounts already powered by DriveWealth's API. Their clients can therefore offer a smoother digital investing experience just as more consumers are seeking online investing services. The partnership also exposes DriveWealth’s brokerage infrastructure to those Plaid clients that may be considering launching an investment product, such as TransferWise.
The Plaid partnership could also support DriveWealth’s move toward embedding investing products on more platforms beyond just financial firms. Fintech disruption aimed at democratizing access to stock trading first focused on doing away with commission fees, introducing fractional shares, and lowering minimum account balances to zero. DriveWealth is positioning itself to power the next step in this evolution: embedding investment services into everyday retail experiences. DriveWealth already lets global brands add investing options to loyalty rewards toolkits, like topping every customer credit card swipe with fractional shares of their stock: “Customers can invest in a fee-based portfolio based on their broader consumption behavior, such as earning stock back from spending money at Starbucks or on Amazon,” CEO Bob Cortright said in an interview with Insider Intelligence. Plaid is already in talks with 25% of Fortune 100 companies with no financial products, including Microsoft, and DriveWealth could help these potential partners embed investing products in the near future.