Dwolla Expands Partnership With Plaid to Streamline Pay by Bank

Pay-by-bank solution provider Dwolla is expanding its partnership with data network Plaid.

The companies will integrate Plaid’s instant account verification and risk assessment tools into Dwolla’s pay-by-bank platform, according to a Wednesday (Oct. 23) press release. The solution is scheduled to launch in early 2025.

The collaboration will target mid- to enterprise-sized businesses, and the goal is to simplify the onboarding process for customers using Dwolla’s Open Banking Services, the release said.

“Expanding our partnership with Dwolla aligns perfectly with our goal of making open banking payments and money movement more accessible and efficient,” Plaid Head of Partnerships Tamara Romanek said in the release. “By combining Plaid’s robust account verification and risk assessment capabilities with Dwolla’s innovative A2A payment infrastructure, we’re creating a powerful tool that will help businesses streamline their payment processes and provide better experiences for their customers.”

The product integration’s key benefits will be a single vendor/API solution, instant transactions and connections to an array of banks, per the release.

“By integrating Plaid’s advanced account verification and risk assessment features into our Open Banking Services, we’re providing a single, unified solution that addresses the complex needs of modern enterprises in the evolving payments landscape,” Dwolla CEO David Glaser said in the release.

In the future, the partnership could also help Dwolla clients reduce risks associated with automated clearing house (ACH) returns and bolster fraud detection efforts, according to the release.

“Our product roadmap will enable Dwolla’s customers to tap into innovative, network-powered insights with solutions such as Plaid Signal and Identity Match, giving businesses access to risk scores, attributes based on transactions and network activity, and verification of account ownership,” Dwolla Chief Technology Officer Skyler Nesheim said in the release.

The integration is part of Dwolla’s ongoing strategy to enhance its Open Banking Services, which already includes partnerships with industry players such as Visa, per the release.

Pay by bank, also known as account-to-account (A2A) payments, is becoming increasingly popular, PYMNTS reported this month. The PYMNTS Intelligence report “Tracking the Digital Payments Takeover: Consumer Familiarity Controls Account-to-Account Payment Growth” found that 36% of consumers use pay by bank.