BankTech

Argyle sees room for more than one pioneer on the “Plaid for Payroll” frontier

Interview with Argyle CEO Shmulik Fishman reveals that verified and consumer-permissioned employment data could displace "the Equifaxes of the world”

When fintech startup Argyle raised $20 million in venture capital last October, co-founder and CEO Shmulik Fishman declared he wanted the company to become the “Plaid for employment records.” Now, Plaid wants to turn the payroll data tables a bit, but Fishman isn’t fretting about the apparent competition.

Fintech startup Plaid revealed March 4 that it’s beta-testing a new product called Plaid Income, a tool for income verification to help consumers with financial tasks such as obtaining a personal loan, qualifying for a mortgage, renting an apartment, leasing a vehicle and getting personalized financial advice. Plaid’s platform connects apps like Robinhood and Venmo to users’ bank accounts. Plaid released a whitepaper in November 2019 titled “Payroll data: The next frontier for open finance.” The whitepaper was not a product announcement, but it did give the market a strong indication that Plaid Income was on the horizon.

“At Plaid, we believe payroll data is the next frontier in fintech and open finance. Access to payroll data has tremendous potential to expand financial opportunity and help people lead healthier financial lives,” Plaid says in a blog post on March 4.

Argyle’s Fishman believes there’s room for more than one pioneer on that next frontier.

“Plaid’s recent news brings to light a major movement that’s happening in lending and underwriting — the adoption of verified and user-permissioned employment data. Competition in this space is fueling innovation and will help bring better services and options to both lenders and consumers,” Argyle’s Fishman told FinLedger.

Argyle enables companies like banks, lenders and insurance companies to quickly access to an applicant’s employment data — access that the applicant authorizes.

While Plaid is venturing into Argyle’s territory of employment data, Fishman explains that his company and Plaid are two different types of business. Plaid makes it simpler for people to review their finances online and move money between apps, he said, whereas Argyle makes it easier for workers to access employment records online and move them from one app to another.

“We are focused on replacing the Equifaxes of the world,” Fishman said, “and changing how employment records are viewed and giving control of employment data back to the individual.”

Historically, lending and leasing decisions have largely been based on a single three-digit number — the credit score. Fishman said Argyle is making decisions based on income verification and employment data more equitable for all people, not just full-time W2 employees. Building credit history and accessing financial services remain big obstacles for gig workers and other 1099 workers, he said.

“Decisions based on income verification and employment data — from small business and emergency or auto loans to housing rentals and mortgages — are life-altering for consumers, for better or worse. This information is the bedrock of financial transactions in society,” Fishman told FinLedger.

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