CIBC’s latest Big Six bank partners with a FinTech on private open banking API

Canadian Imperial Bank of Commerce (CIBC) has entered into a data access agreement with Utah-based FinTech company MX to provide its customers with a seamless way to share financial information.

MX’s agreement with CIBC is the first of its kind for the bank and the first in Canada for MX.

By using MX’s application program interface (API) technology, CIBC said its 11 million customers no longer need to share their bank information to connect their bank information with third-party applications that work with MX, such as personal financial management, budget tracking, and credit building tools.

Founded in 2010 by Ryan Caldwell and Brandon Dewitt, MX combines open finance APIs with financial data to connect and verify data for hundreds of uses, including account opening, money movement and underwriting.

CIBC is the latest member of Canada’s Big Six banks to partner with a US-based FinTech firm to launch what is essentially a private open banking application.

In June, RBC partnered with Yodlee and Plaid to allow users to share their financial data across Yodlee and Plaid’s combined third-party application network of over 7,500.

Working with another Utah-based company, TD teamed up with Finicity in 2020 to lay the groundwork for TD customers to request that TD transfer their financial data for services they want to use, including apps supported by Finicity.

Montreal-based API developer Flinks launched its open banking environment product with the National Bank of Canada last year, allowing FinTech startups to securely access consumer data from financial institutions without the need for screen scraping.

The National Bank announced a commitment of $103 million CAD to Flinks last August, becoming a majority stakeholder in the company. National Bank was the first financial institution to use Flink’s open banking environment product.

RELATED: EQ Bank’s latest bank to join Flink’s open banking environment

Last month, EQ Bank established an integration with Flink’s open banking environment offering called Outbound. This arrangement is expected to provide EQ Bank with the framework to deliver open banking functions and launch new API data sharing methods.

While a handful of banks have entered into API partnerships since Canada began moving toward federally regulated open banking, the remaining members of the Big Six, Scotiabank and Bank of Montréal, have yet to publicly announce such data access agreements.

PwC Canada’s digital banking director Abraham Tachjian was named the country’s open banking leader in March, nearly a year after the Advisory Committee on Open Banking released its final report.

No open banking API or framework currently exists in Canada. However, open banking stakeholders told BetaKit earlier this year that working groups would start in July.

RELATED: RBC Creates Private Open Banking Partnerships With Plaid, Yodlee

CIBC partner MX plays in a space beyond open banking, calling itself an open finance company. According to MX, open finance is an extension of open banking. According to an MX blog post, open finance enables access and sharing of consumer data to more financial products and services beyond banking. This includes loans, consumer credit, investments and pensions. It also enables wider integration of financial data with non-financial industries, such as healthcare and government.

Financial Data Exchange CEO Don Cardinal published an article through Forbes in May, describing open finance as what open banking “wants to be when it grows up.”

MX’s 900-plus workforce includes nine people based in Canada, including Director of Open Finance Andrew Escobar. It works with financial institutions and FinTechs such as H&R Block, MetLife, Gemini, US Bank, WaFd Bank and BECU.

Escobar told BetaKit that MX’s deal with CIBC is the first of its kind for the bank and the first in Canada for MX.

Featured image courtesy of CIBC.