Account Aggregation 101

What is Account Aggregation?

Account aggregation is a financial data technology that gathers account information from multiple financial data sources and provides the information in a single unified view or location.

Consumers/investors or financial professionals, like advisors, can access and view various accounts, such as 401(k)s, investment portfolios, credit cards, and loans, all in one place. Account aggregation can allow users to track their financial balances, transactions, and investments without needing to log into multiple financial institutions websites/applications separately. Account aggregation can also be used by wealth management platforms to enable performance reporting, financial planning, portfolio analysis, compliance management, and more.

What is a Financial Data Aggregator?

An financial data aggregator, like ByAllAccounts, is a data and technology provider that offers account aggregation capabilities to financial institutions, wealth management firms and financial technology providers to embed within their own platform or application. The aggregator continuously maintains connectivity to a large network of data sources (i.e. financial institutions, custodians, crypto exchanges, etc.) After the user permissions the data, the aggregator collects and consolidates data from various sources into a unified format, and delivers the data to their customers. The financial data aggregator can either be generalists or specialize in data that is specific to certain industries or use cases (e.g. wealth management vs. payments).

Is Account Aggregation Secure and Private?

Account aggregators use encryption protocols and stringent security measures to protect sensitive information during the aggregation process. Additionally, they adhere to industry standards and regulations, and ensuring data privacy compliance. However, it's crucial to choose reputable providers and platforms that prioritize robust security practices to maintain the confidentiality and integrity of financial data.