Protocol | Fintech

Plaid’s payroll-data offensive hits a speed bump

Protocol has learned that the financial data aggregator is pausing a product that helped switch consumers' direct deposits to a new bank. It's still pursuing other efforts to provide income data to its fintech customers.

Plaid CEO Zach Perret

Zach Perret is the CEO of Plaid, which is pausing work on its Deposit Switch product.

Photo: George Frey/Bloomberg via Getty Images

Plaid's big move into payroll data — a key area of expansion as the financial data aggregator seeks to grow into its $13.4 billion valuation — has hit a snag after the company was forced to hit pause on a key product that made it easier for consumers to switch direct deposit accounts.

Plaid has suspended work on its new Deposit Switch product, which automates a process that typically involves a manual and time-consuming procedure, Protocol has learned.

A company spokesman confirmed the move: "We recently decided to temporarily pause development efforts on Deposit Switch," he said, in order to "shift resources to accelerate development on Plaid Income, where we see greater immediate opportunities."

"This does not signal that Plaid is less committed to the payroll data API space," the spokesman said.

Plaid unveiled Deposit Switch in January, followed by Plaid Income in March, in what was supposed to be a major offensive in a hot, new fintech arena. Access to payroll data has become a critical need for fintechs looking to offer new services, from income verification to loan underwriting to direct deposit.

Plaid's rollout was viewed as a game-changer for that market, given the company's record as a trailblazer in data aggregation and access technology. Its software tools and services are used by major fintechs including Square, PayPal, Robinhood, SoFi and Affirm.

"The sense I get is that they've definitely poured some gas on the fire in terms of just conversations around the space happening," Alex Johnson, director of fintech research at Cornerstone Advisors, told Protocol. "Plaid entering the market has just sort of sped everything up. Plaid's kind of an 800-pound gorilla at this point."

But accessing data in the payroll market can be challenging. Many payroll-focused startups rely mainly on API connections to secure data, while other companies, including Plaid, use a combination of API access and screen scraping.

Access to banking data is controversial enough — it's the subject of a major regulatory fight over open banking. But payroll data adds more complexities. Instead of just banks, fintechs, consumers and Plaid, you've got employers, who are the paying customers of payroll providers, and their workers. Add in a whole other scheme of regulatory concerns — California and Europe's privacy laws specifically protect employee data, for example — and you've got a recipe for a slowdown.

Johnson said the challenge for players in this space is "striking the right balance between working with the payroll system providers directly and going around them using screen scraping."

"Payroll API startups tend to have a different calculus than established providers like Plaid in determining what that right balance is," he told Protocol.

ADP said in March it was "actively working towards a partnership" with Plaid to provide payroll data without handing over login credentials. That capability appears to be live and available to customers signed up for a beta test, according to Plaid's documentation. Other providers require entering a username and password to log into a payroll provider or employer site.

Plaid is "working closely with leading payroll service providers to prioritize credential-less API data access, a major initiative for Plaid overall as we move into an open finance future," the company spokesman said.

Plaid recently settled a privacy class-action lawsuit for $58 million, agreeing among other things to clearly disclose what data it was collecting and why, and make a user's data available through a portal for verification or deletion on request.

Update: This story was updated on Aug. 12, 2021, to clarify the nature of ADP and Plaid's relationship for payroll data.


VR pioneer The Void is plotting a comeback

Assets of the location-based VR startup have been acquired by a former investor, who plans a relaunch with key former team members.

The Void's New York outpost closed during the pandemic. Now, the company is planning a comeback under new ownership.

Photo: The Void

Location-based VR pioneer The Void may rise from the ashes next year: A former investor has acquired key assets of the defunct startup and is now looking to relaunch it with key team members, Protocol has learned. The company is said to be actively fundraising, and is getting ready to start hiring additional talent soon.

The Void's patents and trademarks were recently acquired by Hyper Reality Partners, a company headed by former OneWeb CEO Adrian Steckel, who also used to be an investor in and board member of The Void. Hyper Reality Partners is actively fundraising for a relaunch of the VR startup, and is said to have raised as much as $20 million already, according to an industry insider.

Keep Reading Show less
Janko Roettgers

Janko Roettgers (@jank0) is a senior reporter at Protocol, reporting on the shifting power dynamics between tech, media, and entertainment, including the impact of new technologies. Previously, Janko was Variety's first-ever technology writer in San Francisco, where he covered big tech and emerging technologies. He has reported for Gigaom, Frankfurter Rundschau, Berliner Zeitung, and ORF, among others. He has written three books on consumer cord-cutting and online music and co-edited an anthology on internet subcultures. He lives with his family in Oakland.

The pandemic won't be over until the economy recovers. While cities, states and regions across the U.S. are grappling with new variants, shifting mask policies and other factors that directly impact businesses large and small, it is nevertheless time for brands and enterprises to jumpstart COVID-19 recovery strategies.

Data will undoubtedly be critical to such strategies, but there is one type of data in particular that is poised to yield greater impact than ever in the COVID-19 Recovery Era: location data.

Keep Reading Show less
Michele Morelli, Foursquare
As SVP of Marketing, Michele is responsible for overseeing the brand strategy, communications, and product and performance marketing of Foursquare’s apps and enterprise products. Prior to joining Foursquare, Michele held several senior leadership positions with wide-ranging responsibilities at AOL, Toluna, Citibank and Yahoo!.
Protocol | Workplace

A new McKinsey study shows that women do more emotional labor at work

The 2021 Women in the Workplace report from McKinsey found that women are far more likely than men to help their teams manage time and work-life balance and provide emotional support.

Senior leaders who identify as women were 60% more likely to provide emotional support to their teams and 26% more likely to help team members navigate work/life challenges, according to the report.

Photo: Luis Alvarez via Getty Images

Over the last year, emotional support, time management skills and work-life balance have become drastically more important and difficult in the workplace — and women leaders were far more likely than men to step in and do that work for their teams, according to the latest iteration of McKinsey and's annual Women in the Workplace report.

Senior leaders who identify as women were 60% more likely to provide emotional support to their teams, 24% more likely to ensure their teams' workload is manageable and 26% more likely to help team members navigate work/life challenges, according to the report. In addition, about one in five women senior leaders spend a substantial amount of time on DEI work that is not central to their job, compared to less than one in 10 male senior leaders.

Keep Reading Show less
Anna Kramer

Anna Kramer is a reporter at Protocol (Twitter: @ anna_c_kramer, email:, where she writes about labor and workplace issues. Prior to joining the team, she covered tech and small business for the San Francisco Chronicle and privacy for Bloomberg Law. She is a recent graduate of Brown University, where she studied International Relations and Arabic and wrote her senior thesis about surveillance tools and technological development in the Middle East.

Amazon needs New World’s launch to be a success

New World arrives Tuesday. Whether it flops could determine the future of Amazon Games.

New World launches on Tuesday, after four delays. It could be Amazon's first big hit.

Image: Amazon

Amazon's New World launches on Tuesday, marking the end of a long and bumpy road to release day for the company's most pivotal video game release to date. There's a lot riding on New World, a massively multiplayer online game in the vein of iconic successes like Blizzard's long-running World of Warcraft and Square Enix's immensely popular Final Fantasy XIV.

If the game succeeds, New World will mark a rare success for a technology company in the gaming space. With the exception of Microsoft, which entered the console game industry nearly two decades ago, tech firms have tried time and again to use their engineering talent and resources to crack the code behind making successful video games. Almost every attempt has failed, but Amazon is the closest to having a hit on its hands. If it flops, we could see Amazon's gaming ambitions go the way of Google's.

Keep Reading Show less
Nick Statt
Nick Statt is Protocol's video game reporter. Prior to joining Protocol, he was news editor at The Verge covering the gaming industry, mobile apps and antitrust out of San Francisco, in addition to managing coverage of Silicon Valley tech giants and startups. He now resides in Rochester, New York, home of the garbage plate and, completely coincidentally, the World Video Game Hall of Fame. He can be reached at
Protocol | Enterprise

Underneath the Dreamforce pomp, Salesforce flexes its financial muscle

Last week, investors got a taste of Salesforce's post-Slack future. And despite looming risks, Wall Street appears to be buying it.

Dreamforce is a chance for customers to come together and celebrate everything Salesforce.

Photo: Salesforce

It's easy to forget that Dreamforce serves an important purpose for Salesforce beyond turning downtown San Francisco into a "Burning Man for people with jobs."

The annual conference is, of course, a chance for customers to come together and celebrate everything Salesforce in an environment that can feel like a cult gathering. In past years, attendees would stand in lines to get their own face imposed over Marc Benioff's latest book release cover or rush to take pictures with one of the multitude of dancing cartoon characters that serve as Salesforce mascots, including a literal "Customer 360" wheel.

Keep Reading Show less
Joe Williams

Joe Williams is a senior reporter at Protocol covering enterprise software, including industry giants like Salesforce, Microsoft, IBM and Oracle. He previously covered emerging technology for Business Insider. Joe can be reached at To share information confidentially, he can also be contacted on a non-work device via Signal (+1-309-265-6120) or

Latest Stories