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Six Considerations Before Sharing Financial Data With Outside Parties

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Sharing financial information can help you improve your business processes and increase your profits. It can also help reduce your expenses. It's important to take into consideration the following factors before deciding to share your financial information with third-party companies.

1. Verify that the services are Legitimate

Some use cases (such a mortgage closing that requires on-demand access to a prospective lender) work better when the user grants only-once access, while other require access to and share large amounts of information over a long period of time. No matter what the method it's essential to look into the app, company or platform's credibility and follow its track record in the industry. Look for reviews on third-party websites including app stores, media and.

2. Think about the breadth of data Sharing

Experts in the field and consumers are of the opinion that financial technology, also known as fintech, apps and banks should improve their practices in sharing account information of customers to prevent security risks, like hacking and identity theft. However, they're skeptical that this will make a difference since many people are uneasy about the current concept of data sharing, which can be as a sham and hinders the possibility of gaining insights.

Banks and fintechs may provide a dashboard for customers to let users control the way that their account data is shared with services they use, such as budgeting apps, credit monitoring tools and even home value and mortgage tracking. For example, Wells Fargo, Chase, Citi and Plaid all allow customers to see the details of accounts shared with these services, and to manage their settings from an account dashboard.