Plaid API: Transfer funds between accounts

Question

I am using the Plaid API for iOS to write a program which accesses banks accounts after authentication and displays the transaction data.

I need to know if it's possible to transfer funds between accounts (checking to savings) and how.

I know acorns uses the same API, and they are able to transfer funds, and Plaid's site claims "Authorize ACH payments in seconds based on the information users know in their heads. No need to know account or routing number. No need for micro-deposits."

But is there documentation on how to move money on the site?

Answer 1

Plaid does not move money via their API.

UPDATES

Dwolla now provides a white-label solution that basically does this all for you. Combine Plaid and Dwolla, and you're basically golden for payments in the US now.

Disclaimer: I co-founded a company that is a customer of Dwolla and one of their first white label customers.

Original content

Moving money with the credentials that Plaid provides requires using the Automated Clearing House (ACH) process in the US.

What won't work

Ripple Labs (currently under federal investigation), Dwolla, BitPay, etc. all require proprietary authentication with their own platforms before they will move money. You can't use them with the routing and account number that you get from Plaid. You have to adopt their entire system...or nothing.

What will work

Plaid's API provides more for you than those other APIs because you have the routing and account number. This allows you to directly enter into the ACH system yourself. All you need to move money is the senders routing and account number, the receiver's routing and account number, and the amount. Plaid gives you 2/5 of this already.

But you need to move the funds. Using an ACH processor (like Vericheck - I was a customer), you can use their API to send money to an account. Or a bank (like Silicon Valley Bank - also was a customer), where you can generate and upload a NACHA file with the instructions.

What you're in for

Compliance and banking laws are strict. Get a good lawyer to help explain what you're up against. ACH processors will want to do comprehensive background checks on you and your business. Banks will require you to deposit a portion of your proposed transactions to cover STOP payments (when a user tells their bank to cancel a payment, like voiding a check). You may have to register as a money transmitter (a small $1M in filing, registration, and legal fees for all 50 states).

Moving money is still difficult to do on behalf of a user, but if you're willing to put in the legal work, the programming is pretty simple!

Answer 2

Plaid's API actually will give you routing and account number information and/or transaction data with cool info like GPS coordinates of transactions but I believe when I spoke to them they explicitly said that they don't provide money moving services in their API.

I've been looking at Ripple Labs, Dwolla, BitPay, etcetera.

If you have any recommendations about getting Plaid and Meteor working well together, then I can add you to a Cloud9 workspace and would be delighted to learn. :)

Answer 3

Plaid recently signed an agreement with Stripe. Stripe allows you to move funds via ACH through their newly realeased API: https://stripe.com/blog/accept-ach-payments This is very similar to what companies like Peloton Technologies Inc. have been doing in Canada for EFT since 2010. EFT is what most parts of the world refer to as ACH.

Plaid provides Stripe with a higher possibility of being able to instantly verify a bank account, otherwise they fall back to the old Paypal 4 day verification processes of issuing a couple of transfers and waiting for the users to verify the amounts.

The pain of waiting on the user and the fact that 7 out of 10 times a bank account is entered wrong is what has probably prevented Stripe and other companies entering this space until now.