Account Information Service Providers

Account Information Service Providers

Account Information Service Providers (AISPs) are a part of the Revised Payment Services Directive (PSD2) regulatory framework. AISPs have been developed along with the Payment Initiation Service Providers (PISPs) regulatory framework, thus they both aim to ensure consistent consumer financial data safeguarding on the transactional value chain. At the same time, it increases new product accessibility and development within the financial sector. 

Since the beginning of PSD2 AISPs were the heart of a financial landscape. Open banking has unlocked doors to partnerships among businesses and financial institutions by creating a connection that allows extremely fast data sharing. Hence, the first open banking enabled services relied truly on Account Information Service Providers and their development is the most visible in the current light of open banking.

Account Information Service Providers together with legacy financial institutions have created tools to aid businesses and individuals to better understand their financial information. It also enabled AISPs to create a new level of user experience satisfaction. 

What are account information service providers?

Account Information Service Providers came into the picture because of the need for clearer and easily accessible financial information. PSD2 enabled businesses and consumers to authorise AISPs to gather their financial information and showcase it in one dashboard. Regardless, AISPs obtain no validation for using the funds accessed. In other words, they can only look, but can’t touch. 

Any company that has an AISP licence can perform the aforementioned measures and assist their customers. Their purpose is to aggregate the financial data of their customer and portray it easily and understandably. The data can be gathered from different financial institutions and various bank accounts as long as it has customers’ consent. 

AISPs can be used not only to a consumer’s benefit but also to help businesses make faster decisions based on real-time data. Hence, AISP can act as an intermediary between the account holder and the Third Party Service Provider (TPSP). This service chain eliminates infinite documentation requirements and helps end customers to receive higher quality services within a short period. For example, if a business or a consumer wishes to get a loan, the lender can use AISPs services and gather the real financial information eliminating errors and interpretations that could occur due to limitless physical financial statement submissions. 

Details to look for when choosing an AISP

First of all, it is crucial to understand the mandatory legal requirements for an AISP. The key requirement, that all Account Information Service Providers should have, is the licence. Second is the legal compliance with the data protection legislation, meaning that they must provide any information related to the use of a customer’s data upon request. Also, AISP must record who, why, for how long and what information can access the data after the customer’s consent. 

Use cases of AISP

The main use case for AISPs is decision making for loan granting. It is especially beneficial to the lenders who don’t have access to the financial history of their clients, therefore, the AISP helps to accelerate the process. It can determine the credit rating, financial history and level of income. The lender can be a legacy or challenger bank, credit platform or even a factoring provider for a business. When an Account Information Service is Involved in the lending process it is curtailed and goes from weeks/days to several hours or even minutes. 

Another use for an AISP is creating a partnership between financial institutions and Fintech. Services like banking apps, online instant loans and many other products created by Fintech can function due to digital account checking based on the AISP. 

As a result, Account Information Service Providers are a key for advancing and developing new products and apps by Fintech. 

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