Plaid, a diversified FinTech infrastructure provider, has partnered with Square, a payment services company, to enable US merchants to accept direct automated clearing house (ACH) payments, which are typically a lower-cost and more accessible alternative to credit cards.

The partnership will leverage Plaid's platform, allowing customers to authorize their bank accounts to make payments, and Square’s tokenized check system, for customers to connect their accounts to enable bank payments.

Accordingly, merchants can process ACH payments without holding banking data by enabling the payments through the “Square Web Payments” system development kit (SDK).

Plaid offers white-label and full-stack financial technology (FinTech) infrastructure for financial institutions, wealth managers, and other enterprises to embed banking, payment, financial advice, and lending solutions to their FinTechs. It also enables users to connect their financial accounts to a multitude of third-party apps, including Venmo, SoFi, Stripe, and M1 finance, among others. As of April 2021, its infrastructure connected enterprises to more than 11,000 financial institutions across the US, Canada, the UK, and Europe.