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Investing.com -- Paypal (NASDAQ:PYPL) stock fell 3.8% and Block, Inc (NYSE:XYZ) dropped 2.8% after reports that JPMorgan Chase & Co. (NYSE:JPM) plans to charge fintech companies for access to customer data.
According to Bloomberg, JPMorgan has distributed pricing sheets to data aggregators outlining new fees that could amount to hundreds of millions of dollars. These aggregators serve as intermediaries connecting banks and fintech companies. The fees will vary based on how companies utilize the information, with payment-focused firms facing higher charges.
The new fee structure is expected to be implemented later this year, pending the outcome of a Biden administration regulation. The charges are not yet finalized and could be subject to negotiation.
A JPMorgan spokesperson stated that the bank has made significant investments to create a secure system protecting consumer data. "We’ve had productive conversations and are working with the entire ecosystem to ensure we’re all making the necessary investments in the infrastructure that keeps our customers safe," the spokesperson said.
The move by the largest U.S. bank could potentially disrupt business models across the fintech industry, as companies that have previously accessed customer banking information without direct charges would now face substantial fees for this data access.