Launches Archives

Launching: "Final" Credit Card with Integrated Disposable Card Numbers Captures Imagination of Product Hunt Geeks

By Jim Bruene on October 9, 2014 6:38 PM | Comments

imageProduct Hunt is the newest website catering to tech enthusiasts. Each day 40 to 50 new products or new product features are featured on the site. Anyone who has registered is allowed to upvote any of the submissions and a continually updated leaderboard surfaces the hottest products of the day. Then at midnight, the whole thing resets, and 40 to 50 more products get their 24 hours of fame. I've been following it for a few months and have seen that while only two or three fintech entries appear each week, they tend to be popular (which could be a function of their scarcity). But rarely, if ever, do they climb to the top. And this week, not one, but two companies have dominated their day on Product Hunt.

On Tuesday, the Plastc Card (yes, spell check, no "i") garnered 545 votes, almost 200 more than runner-up Student Developer Pack. Plastc is similar to Coin, a computerized credit card that can hold multiple mag-stripe cards in a single piece of plastic, planning to ship to pre-order backers in the first half of 2015. Plastc holds more cards, has an e-Ink display, and at $169, costs more than three times the pre-order price of Coin.

On Wednesday, fintech ruled Product Hunt again, with new security-minded credit card Final gaining more than 900 upvotes, 600 more than the next-closest newcomer, Clearbit. I believe it's the record for a financial product, eclipsing Plastc's from the day before.

image What is Final?
Final is a standard mag-stripe (and chip) credit card with a companion mobile app and desktop dashboard. The card is upping the security ante by incorporating easy-to-use disposable (aka temporary) card numbers for ecommerce (card not present). It allows users to designate a unique number for every online merchant, that way it's easy to shut that merchant off, if you don't want them to be able to charge your card again. Users can also set transaction limits by merchants to make sure there are no overcharges.

Final also plans to offer advanced controls for brick and mortar purchases. Purchases could be allowed at only certain merchant categories, for example. And Final's card will be able to be tethered to your smartphone allowing chip-and-pin purchases only when the two are in close proximity to each other. 

The card-management app features PFM features not unlike what Moven and Simple offer today. But there is more emphasis on fraud controls and ridding yourself of "gray charges" ala BillGuard (see inset). In fact, the best way to think of Final is a credit card version of a Moven/BillGuard mashup. It is to credit cards what Simple was to checking accounts. A winning combination of good design, consumer advocacy and a bit of tech flair.

The startup is still looking for a credit card issuer-partner (attention Capital One, this could be your 360 credit card), so pricing is not available. However, CEO Matt Rothstein told me yesterday that they plan to make the card fee-free. In fact, they are looking at the business as much more than just a security play. They are focused on consumer advocacy and helping consumers reign in their spending (see first screenshot).

Final Thoughts 
Final is part of the current batch at TechStars Boulder and is pitching at its Demo Day today. The company has 2,200 people on its waitlist (Update: As of noon Pacific on 10 Oct 2014, the number has jumped to more than 21,000). Not a bad first-24-hours out of stealth. There is clearly consumer demand for more card controls, to avoid outright fraud, fight merchant overcharges and reign in overspending.

imageMost of the newcomers that have gone down this path have used prepaid debit cards and/or account aggregation. We haven't seen an ambitious startup credit card play since well before the 2008 meltdown. Final will benefit from substantially higher interchange (albeit shared with its partner), but will also have to deal with rejecting the credit applications from a significant portion of its waitlist. That will not be easy to explain to the early adopter crowd, who will likely take their case to social media (note 1).   

But overall, I'm a big fan of what they are trying to do, and expect to be following Final for a long time, unless they get swooped up by a large issuer right out of the gate.


Final desktop card management area: Transaction view (9 Oct 2014)
A.) Current balance and monthly goal dominate top of page. 
B.) Customer service, and a log of recent inquiries, appears in right sidebar


Final desktop card management area: Budget view



1. I'd advise having a prepaid card backup to mitigate the rejected applicant backlash.


Launching: Self Lender Helps Build Credit with Digital "Credit-Builder" Loans

By Jim Bruene on September 9, 2014 4:55 PM | Comments

image Ever since the financial debacle of 2008, it's been harder for consumers to establish their first credit account. Therefore, with no credit history or score, it becomes even harder to get credit. That's created a Catch-22 around new credit that Denver-based startup Self Lender looks to address. The company launched today at TechCrunch Disrupt (see full presentation here, at bottom of post).

Self Lender has a fairly straightforward value proposition.

  • Agree to transfer a certain amount of money to yourself for a set period of time via the Self Lender platform.
  • Self Lender reports the payments to credit bureaus as a secured loan.
  • At the end of the contract period, between 3 and 12 months, the user gets their money back (without interest) or can use the funds as a down payment on a vehicle or other item with the balance financed by Self Lender lending partners (see screenshot below).

The funds are held in an FDIC-insured account. Users can make their monthly transfers via ACH, debit card, paper check/money orders, or via cash through PayNearMe's network. The startup also will accept bitcoin payments, an interesting side note that wasn't mentioned during their demo.

Self Lender will make a few dollars on interest and lead-gen commissions, but its primary business model revolves around charging $3 per month for the service.

Thoughts: Many banks and credit unions offer products with similar benefits. According to CUNA (note 1), 15% of U.S. credit unions offer "credit builder loans." Banks and credit unions also offer CD/saving secured loans. But those deposit-secured loans generally require a good sum of cash to get started. For example, Wells Fargo has a $3,000 minimum deposit and $75 origination fee. Self Lender lets you get started with just $25.

So, the concept is good. But I think it will be difficult for the company to get consumers to entrust them directly, so distribution through FI or PFM partners is crucial. To that end, during the Q&A session, Self Lender said it was hoping to ink deals with one or more major banks in the near future. 


Self Lender demonstrates how the money saved in the platform can be used as down payment (9 Sep 2014)



1. Source: NY Times, 6 Feb 2012.


Launching: Allre Will Help You Sell Your House for Zero Commission

By Jim Bruene on September 8, 2014 7:18 PM | Comments

imageSo far, the U.S. real estate industry has maintained its 6% standard commission despite mass adoption of the Internet for researching available properties. And the run-up in housing prices in many areas has made real-dollar commissions much larger than they were in 1995. Certainly Redfin and others rebating commissions on the buyer's side have made inroads. But if the seller's agent is still taking 3% the total commission remains stubbornly high.

Enter, a San Diego-based startup that debuted at TechCrunch Disrupt today (demo video). Taking a page from Zenefits model (free payroll services if you buy your healthcare through them), Allre will do the real estate transaction for free. That would save the average California seller $24,000 in commissions.

The catch? Buyers use the Allre platform to buy their title insurance, homeowner's insurance, mortgage and other closing services. Allre is able to book these ancillary commissions because as a free service it does not come under RESPA regulations forbidding such arrangements.

Allre said it will work with multiple vendors in each category; however, for now its exclusive mortgage provider in its first market is Prime Lending.

Real estate is a business with huge network effects, which is why the various MLS services around the country continue to maintain a tight grip on real estate marketing, and commissions. So the challenge for Allre, or anyone who wants to take on the local commissioned base, is to get a large cross-section of homes listed on its site. The company has some ideas on how to do that (see the Q&A session that follows the TC demo, specifically, the question at the 7:06 mark), but no one has really cracked that nut yet.  

Relevance for Netbankers: Home ownership, and the financial services surrounding it, is an area that holds significant profit potential for banks and credit unions. Working with Allre or other real estate disrupters could be an effective way to find new mortgage (and banking) customers. 


Allre homepage (8 Sep 2014)


Allre transaction dashboard



Launching: Credible Will Refi Your Student Loans Through Cooperating Lenders

By Jim Bruene on February 28, 2014 2:25 PM | Comments

image On Monday, Credible debuted its student loan refi platform at Jason Calacanis's Launch Festival (see demo below). The demo was a judge favorite, with three of the five judges naming it their favorite among the eight demos in that session. And the company ended up taking home the trophy (and optional investment) as the best established company demo. The overall winner was Connect, an address book that maps your contacts from social networks.


How it works

The business model is similar to Lending Tree. Users answer eight questions, all from memory:

1. Do you have a PRIVATE student loan? (Yes/No)
2. What year did you graduate? (choose 2001 to 2012)
3. What was the last school you graduated from?
4. Do you have graduate or postgraduate degree? (Yes/No)
5. What is your approximate income? (slider $0 to $200,000+)
6. What is your approximate student loan balance? (slider $0 to $200,000+)
7. What is the approximate interest rate on your student loan? (slider 2% to 15%+)
8. What is your approximate credit score? (slider very poor/300 to excellent/850)

Close = Enter your email address to get results

At the end of that 60-second quiz, as soon as the email is entered, Credible displays the potential savings from a student loan refi.

Interested borrowers select the Switch Lenders Now button, download their actual loan info through account aggregation technology (the demo showed Intuit powering an account scrape of Sallie Mae), complete a short loan, and upload a scan of their drivers license and last pay stub.

That info is sent off to student lenders who make actual credit offers to the user within two to three days (see screenshot #2). 

In the 24 Feb 2014 demo, using an actual student from their beta launch, the three competing lenders shown were (may not be real quotes however):

  • Wells Fargo at 3.75%
  • SoFI at 5.88%
  • CU Student Loans at 4.90%


About Credible

  • San Francisco-based startup launched in Feb 2014
  • Raised $500,000
  • 30,000 borrowers registered during its beta test (carried out under previous incarnation,
  • Founder Stephen Dash worked at JP Morgan Chase
  • Its goal is to move beyond student loans into "every bank and insurance service."


Bottom line

As proven by the success of Sofi ($400 million funded) and the buzz around Finovate alum, the student loan market is ripe for new thinking (I won't say disruption, because debt consolidation is hardly a new concept). That said, existing financial institutions can play in this game, and win if they want to. We believe customers would be more likely to refi if it was delivered by their primary financial institution within the secure online (or mobile) environment.

And the great thing about saving your up-and-coming customers a few grand each year is that they are hardly going to jump ship to save $5 per month on a checking account.



1. Credible wizard results


2. Competing offers



Credible demo (will launch in separate window set to begin demo at the 1 hour, 56 min mark; 25 Feb 2014)


Categories: Launches, Student Loans

Financial Innovation Marches On, Even in July

By Jim Bruene on August 1, 2013 10:11 AM | Comments

image I subscribe to about 800 blogs/alerts and usually find one or two new fintech companies, potential Finovate presenters, every single day. But July was slower, with the pace of new companies dropping to a few per week. Even though I know summer tends to be quieter, I always start wondering if we've finally invented everything...then I wake up to my RSS feed this morning and find two clever new services launching today:  

  • Crowdsourced home values: Everyone who owns a home wonders how much it's worth. But unless you have a real estate agent in the family (and even then, they are probably biased to the high side), it's a time-consuming and not-so-exact science to get a professional appraisal. Enter Redfin's "home price whisperer" service. Participants simply submit their house address and target price, and the company will have 250 others users give the valuation a thumbs up or thumbs down. While it won't put realtors out of business, it's a great way to get a quick handle on where you stand on what can be a key part of your financial security. (Another new startup, Trov, just landed $6.8 mil to help value less liquid assets).
  • Scam-protection geared to the elderly: Ever since Y-Combinator (YC) spawned a pair of billion-dollar companies during the Great Recession (AirBnB, Dropbox), I've been watching closely to see what its graduates will offer up to the financial services world. At FinovateSpring last May, we saw 2012 YC graduate LendUp (watch its Finovate demo here) wow the audience (and win Best of Show) with its service to lift consumers out of the payday lending cycle into less-expensive bank credit products. In a similar vein, 2013 YC graduate True Link Financial just announced a service to protect consumers, especially the elderly, from getting scammed by misleading or downright fraudulent charitable solicitations and other gray charges (it's like BillGuard, but trying to block the questionable charges first, rather than dispute later). It's basically a $20/yr prepaid card with customizable spending controls.

image So, it looks like we have officially moved into the second half of the year and all the fintech excitement that will bring. I'd be remiss if I didn't put in a plug for the upcoming FinovateFall, where we'll have 72 demos (full list here) offering up a plethora of new ideas. The early-bird deadline is Aug 2. So register now and save. 


First Look: Moven Bank's Online Application

By Jim Bruene on July 9, 2013 7:07 PM | Comments


I finally received a Moven (bank) invite, first forwarded from a reader (thanks, Michael), then a few days later directly from the company (see screenshot #1). Yesterday, I went through the drop-dead simple application process (see screenshots 2-8) and as soon as my card arrives, I'll start putting transactions into the system.

The application is well designed. Here are a few things other financial institutions can learn from my Moven experience:

  • After clicking through the invite (screenshot #1), I arrived on a personalized landing-page (ss #2) with simple instructions on what was required for signup. It also has Facebook integration (I was already registered with the Moven site, so it didn't apply to me).
  • Key information is collected against a striking backdrop of a great-looking cappuccino (ss #3, #5).
  • As seen in the account disclosures (ss #4), the issuing bank is CBW, the same one working with Simple.  
  • The applicant's mobile number is verified prior to completing the app (ss #7).
  • Account funding is not handled during the initial app; instead, the company asks for bank account info and then sends trial deposits to authenticate the user (ss #8). This step can be skipped, but it's the only way to get money into the account, so it has to be completed eventually.
  • The application concludes with a clear thank-you that also outlines the next steps (ss #10).
  • Finally, something I've not seen before. The startup invites new customers to start managing their spending right away using its Geezeo-powered PFM module (lower-right on ss #10).
  • Within minutes a thank-you email arrives emphasizing the next steps (ss #11)

Bottom line: Going in, my expectations were high. And Moven still exceeded them. This was a near-perfect signup process as far as I was concerned. The only flaw was the slightly confusing Facebook authorization process. After clicking the Facebook button on the bottom of the first page (ss #2), I expected to see Facebook talking to me about what I wanted to share with Moven. But instead, I proceeded directly to the next page of Moven's app with no mention of Facebook. I assume this happened because I'd already authorized Moven to access my Facebook account months ago when I registered at the site. But overall...impressive. 


1. Moven invite (1 July 2013)


2. Personalized landing page with Facebook integration (required)
Note: My email address is already lifted from the invite


3. Name and email confirmation


4. Terms and conditions
Note: Issuer is CBW Bank


5. Choose 4-digit PIN


6. Personal info


7. Verify mobile number


8. Funding


9. Confirmation
A.) Trial deposit system is explained
B.) PFM linkage


10. PFM linkage


11. Confirmation email



1. Picture from Moven's FinovateSpring appearance, 15 May 2013 (video)
2. For more info on other Truly Virtual Banks, see our Oct 2011 Online Banking Report (subscription). For more on advanced PFM features, see Online Banking Report: PFM 4.0 (June 2012; subscription).


Crowdfunding via Facebook: Puddle's P2P Platform Allows Friends to Pool Funds to Loan to Each Other

By Jim Bruene on June 3, 2013 4:37 PM | Comments

image When Prosper launched seven years ago, much of it's initial promise revolved around the notion that people would be more likely to repay loans made by their peers. To  create peer pressure, borrowers were encouraged to join loosely affiliated "groups" (see note 1). Over time, groups with good repayment performance would be rewarded with lower borrowing costs.

It was brilliant on paper, but early repayment behavior didn't follow the model. Had there been more runway (funding and/or regulatory tolerance), it might have worked. But the wicked combination of adverse selection (many initial borrowers were financially desperate and/or quasi-fraudulent, despite all the heart-warming stories posted) and the Great Recession pushed Prosper, and it's contemporary, Lending Club, into more standard unsecured lending procedures. And it seems to be working. The two are on track to do more than $2 billion this year, with revenues of $100 million or more (Note: 85% of current volume is from Lending Club, see latest numbers here).

Fast-forward five years: With the ubiquity of Facebook, it makes sense for newcomers to test the waters of the original Prosper/Lending Club hypothesis (note 2). That friends can lend to friends (F2F) at a far lower cost. And that a third-party platform is needed to facilitate lending relationships, which can become tense if borrowers fall behind or default on their obligations.

imagePuddle (formerly is a new startup from Kiva CEO & Co-founder Matt Flannery and early Kiva developer Skylar Woodward along with Jean Claude Rodriguez. It uses Facebook bonds to create pools of money that friend groups can share amongst themselves. With suggested interest rates in the 4% range, it's a win-win, assuming the money is repaid. Borrowers save 10% or more from credit card rates and lenders get a return much higher than bank savings accounts.


How it Works

1. Register with the company using your Facebook credentials

2. Connect a PayPal account or debit card to the platform (Wells Fargo holds the money)

3. Start a new "puddle" by setting the rate from 0% to 20% (current average is 4.7%, see inset) and the maximum leverage rate (you can only borrow a multiple of what you put into the pool, the allowable range is 2:1 to 10:1 with the recommended rate of 8:1).  

4. Invite Facebook friends to throw cash into the pool

5. Borrow from the pool (if that is your intent). Currently, loan sizes range from $300 to $3,000 with repayment on an installment schedule spread over a maximum of 12 months (current average outstanding is $320 across 50 borrowers). You can only borrow a max of 40% of the entire pool.

6. Puddle manages the repayment process, including assessing late fees (the late penalty is equal to the interest owed on the previous month's installment, i.e., you pay double interest if late)

7. As funds are repaid, they become available to other members of the pool to borrow.  



Like Prosper/Lending Club in 2006/2007, the Puddle model sounds great in theory. But should friends be encouraged to lend to their friends online? I can see this ending badly, with unfortunate borrowers losing more than just the $1,000 they took out of the pool. With a public default to your (ex)friends, will a bad situation just get worse?

But given the founders experience at online microfinance leader Kiva, which has spread $440 million around the globe from nearly 1 million lenders, they fully understand the pitfalls. They also know that affordable credit can change lives.

Bottom line: I think it's a great experiment (and it is an experiment, the founders admit to not knowing how they will monetize or how regulators will react). But I'm not sure it scales without more financial controls (underwriting, collections, income verification) at which point it becomes nuch like Lending Club in 2007 (though not a bad outcome...given the P2P pioneer's recent $1.6 billion VC valuation).

I'd like to see financial institutions (or accredited investors) stepping in to backstop the loans (perhaps keeping the default confidential). For example, for a 4% to 5% annual fee, investors would agree to reimburse the pool for 80% to 90% of losses from any defaulting borrower. The fee would vary depending on the credit profile of borrowers in the pool. While borrowing costs would be significantly higher, down-on-their-luck borrowers would be less likely to lose their friends just when they needed them most. 


Puddle dashboard (active user)

Puddle dashboard

The Puddle dashboard through the eyes of a new user
Note: The great definition in box 1, "A puddle is like a small bank owned by you and your friends. You set the rules."

Puddle new user "get started" screen


image1. For a review of circa-2006 Prosper "groups" see our March 2006 report on P2P lending (subscription).
2. Lending Club initially launched as a Facebook-only p2p lending service (our original 25 May 2007 post). The original Lending Club Facebook page is shown at right (click on inset). 
3. For the latest on crowdfunding, see our latest Online Banking Report on Crowdfunding (subscription).


Movenbank Provides a Peek at its User Interface

By Jim Bruene on January 29, 2013 10:11 PM | Comments

imageTech startups help define the future in many traditional industries. Amazon in books, Expedia in travel, Tesla in automobiles.

But there's been less disruption in retail banking than most industries, especially in the U.S. We saw ING Direct take some share in savings accounts, but not enough to really shake up the status quo. 

But we have some new players looking to change that and Movenbank is one of the most interesting. The Brett King-founded startup, armed with $2.4 mil in seed funding, is beginning to release more details as it prepares for its launch at our FinovateEurope event in two weeks.

In an email to customers today, the startup provided a few peeks at its Geezeo-powered PFM interface (screenshot below):

  • MoneyPulse: A snapshot of the your current financial situation with green/yellow/red dial so you know in a glance if there are problems.
  • Movenbank MasterCard PayPass sticker MoneyPath: More of a typical budgeting piece.  
  • Account aggregation: Beta users can already add accounts from several-hundred banks and credit unions; so unlike Simple, it appears Movenbank is supporting account aggregation out of the box
  • Spend | Save | Live: Primary navigation across the top of the dashboard

In addition, the "how it works" section shows a MasterCard PayPass sticker used for contactless payments (inset).


Movenbank interface (from customer email, 28 Jan 2013)
Note: "Spend | Save | Live" navigation across top.
This appears to be a PC user interface, but it could be a tablet UI.

Movenbank user interface w PFM features


Launching: MetroMile Launches Mileage-Based Auto Insurance

By Jim Bruene on December 5, 2012 6:11 PM | Comments

image One of the dumber things I've ever done financially is buy an old two-seat convertible on eBay. Who would have guessed that you just don't get a chance to drive that thing much in Seattle? But next July, when the sun comes out again, I'll be very happy to have it.

In the meantime, I have this nasty monthly insurance bill. Really, $60 per month to have the car sit idle in my garage? It's throwing good money after bad. I should call my agent and turn the insurance off. But what if there's a sun-break this month or our other car is in the shop? Then I'll need it.  

From the insurance company's perspective, they don't want me calling to activate/deactivate insurance multiple times per year (though they love my current zero-miles-per-winter full-pay status). The subsequent labor and fulfillment cost would wipe out much, if not all, the profitability on my account.

So, I'm the perfect candidate for pay-as-you-go insurance, and I'm happy to see it launch in Oregon, thanks to MetroMile, a VC-backed Bay Area startup (note 1). Hopefully, it will make it's way north to Seattle very soon.

How it works

imageMetroMile charges a smaller fixed monthly fee, then adds a variable charge based on the number of miles driven (with a cap at 150 miles in a day).

To calculate the mileage fee users plug a small device called a Metronome into their on-board diagnostic port (note 2). It measures miles traveled and tracks GPS location to create a rich history of your touring (see inset & screenshot 1, note 3).

Oregon residents can get a lightening-fast quote (screenshots 2 to 5) and complete the app online (screenshot 6). The quote on my convertible came was $29/mo plus 2.3 cents per mile (screenshot 4). This would be an amazing deal for me, cutting my insurance costs by 50% annually (note 4). I would save money every month I drove less than 1,300 miles. 


Opportunity for financial institutions 

It's going to take a massive education process before this new type of insurance becomes popular (assuming state regulators allow it). Show customers that you are innovative and can deliver superior value by introducing them to a financial product that could save them $20 per month for the rest of their lives. And one that delivers a rich history of their car travel (which can eventually be plugged into the bank's PFM).

You could even package it with other bank products (checking, savings, car loans, etc) to continue to remind customers that you helped save them big time. Even more interesting, would be bundling the insurance with mileage-based auto financing to provide an even bigger incentive to save money by driving fewer miles. 

Right now, in the United States, only Oregon FIs could participate (note 5). But as the product spreads nationwide across multiple providers, it could make a nice, profitable product addition to your web and mobile offerings.  


1. MetroMile dashboard showing GPS data compiled from tracking device (5 Dec 2012)


2. MetroMile homepage features 2-minute quote
(5 Dec 2012)
Note: Unlike virtually all insurance quote sites, no contact info is required to find the actual price. And you for one car and one driver, you can fill out the form in as little as 60 seconds, my actual time the third time I tried it.

MetroMile homepage features 2-minute quote (5 Dec 2012)

3. Step 1: Enter primary driver info


4. Step 2: Enter vehicle info

Step 2: Enter vehicle info

5. Step 3: The final price is delivered in the the third-pane of the application

Step 3: The final price is delivered in the the third-pane of the application

6. Finalize online app with contact info

6. Finalize online app with contact info

1. Hat tip to Pando Daily.
2. The port is available on all cars built since 1996.
3. The device could also be used to measure average speed, but GPS data collection is optional and is not currently used by the company.  
4. I was comparing my current Seattle price to a Portland quote, so that could be a portion of the difference.
5. We don't know if MetroMile is will pay for referrals at this time.
6. For more on banks offering insurance, see our full report here (Dec 2011, subscription)


Launching: Automatic Location-and-Merchant-Based Prepaid-Card Reloading with Spending Controls

By Jim Bruene on October 3, 2012 11:31 AM | Comments (1)

image That's a lot of buzzwords in one title, but they're all necessary to describe the payment innovation being tested by MoviePass.

MoviePass is a new service designed to do for physical movie theatres what Netflix did for rentals, turning movie-going into an all-you-can-eat subscription service. For $25 to $40/mo (depending on where you live), MoviePass allows you to attend as many movies as you like (but no more than once per day; note 1).

However, the company has had trouble getting theatres on board, who are rightly concerned about cannibalization. So the startup has been working on ways to get around the need to have theater partners. They tried in-home voucher printing, but it proved cumbersome and still required some level of theatre participation.

So MoviePass invented a clever workaround using a proprietary prepaid debit card. The new system allows subscribers to go to any movie at any theatre in the country, as long as they accept debit/credit cards. The service is in private beta with 1,500 users. You can add your name to the 75,000-person wait list here.

MoviePass iphone app Here's how it works:

1. User goes to the theatre location and checks in using the MoviePass app (inset). The check-in only works within 100 yards of the theatre.

2. MoviePass then adds the price of the movie to its prepaid card.

3. Consumer walks to the window and purchases a ticket with the MoviePass card using up the entire balance (note 2).

It's a clever mashup of GPS, point of sale, mobile and payment technologies.

Relevance: No word on who's powering the card, but hopefully we'll see it used in other applications. It could be a solution for youth spending (parents preapprove locations/amounts), employee purchases (employers preapprove locations/amounts), or rewards/offers (money appears on your card only when you check in at specific locations).


1. Clearly, the company won't be able to make a return at $40/mo unless they cut deals with theatres for discounts (especially to fill second-run and weeknight seats), which is the end-game here. At a cost of $5/ticket, it probably works. At $10 per ticket, movie buffs hitting theatres two to three times per week are going to kill the model.  
2. Presumably, MoviePass has controls that limit the purchase to the theatre where the checkin occurred. And it must be limiting checkins to the registered phone only, otherwise the card could be passed to friends and the biz model won't work. I also assume MoviePass will confiscate any unused balance if the ticket price is less than what was advanced or if the customer doesn't buy a ticket.    
3. It would be interesting if they also partnered with RedBox so you could get unlimited DVD rentals AND theatres in one monthly price.

Comments (1)

Two Card-Linked Offers/Rewards Startups Launch at TechCrunch Disrupt

By Jim Bruene on May 24, 2012 1:04 AM | Comments

image While I've read TechCrunch since its beginning, I've only been able to make it to their semi-annual event, Disrupt, once before. It's usually just too close to our own Finovate. But this year I made the trek to Pier 94 in Manhattan to see what was going on in tech in general and to meet with the fintech startups in the Startup Alley or Battlefield launch competition.

There were six fintech companies in total. Three offered variations on card-linked offers, one has developed an alternative payment system, one was a newer payments gateway, and surprisingly there was just a single crowdfunding platform.  

Startup Battlefield competitors from fintech: TechCrunch selected thirty companies in advance. All have agreed to launch their companies on stage at the event. 

  • imageCardify: Card-linked loyalty/offers geared toward local merchants. Sean Rad is CEO and of the West Hollywood company which has raised $750,000.
  • imageMirth: Same as above. Jeremy Philip Galen is Founder. The NYC-based company is bootstrapped. 

Startup Alley participants from fintech: These are companies less than two years old that qualify for a table in the networking hall. Each day one of the Alley companies is voted to the stage to imagecompete in the Battlefield.

  • LocalBonus: A card-linked offers platform focusing on the local market
  • imagePayintele: An alt-payments company using barcodes to pass info between merchant and payee (I'll do a whole post on them shortly)image
  • PayLeap: A payments gateway from two previous execs
  • The Crowd Funds: A crowdfunding startup from former image E*Trade CTO, Joshua Levine

Observations: It was interesting to see three new card-linked rewards companies all going after the local market. But if you look at what Groupon's done with local merchants and where Square is headed, you can see there are huge opportunities here.

And the payment APIs available from Cardspring (which both Mirth and Cardify use) are making it relatively easy for startups to tap into a merchant's card transaction streams to make offers, tally rewards, identify frequent customers, and communicate with them.

As a side note, Cardify has a gorgeous UI. It's very hip and high-end looking like something you'd see at more well-funded companies such as Square, Simple or Mint (screenshot below). Kudos to the design folk there.


Cardify homepage (24 May 2012)

cardify app as seen on its homepage


1. While not a fintech company, as an auction junkie, I was intrigued by Outbid's social mobile/online auction platform. The company said it's talking to four banks looking to host live auctions on their site to use for promotions and social gaming. I think it's a promising idea, one I've explored a few times over the years. But with Facebook Connect you can actually get a critical mass of customers involved very quickly. The company had the cheesiest demo I've ever seen (and that's saying something), but that shouldn't impact your decision.


Launching: EFTGuard Provides $500k in Online Fraud Protection for Business Banking Customers

By Jim Bruene on April 24, 2012 8:06 PM | Comments

image That was fast. Just two weeks after my latest appeal to the industry to provide small business owners with more security options, a new product launched today aims to do just that. And it's packaged as a turn-key, fee-based service that could be sold by banks at a $10+ per month profit (MSRP is $25/mo).  

That all sounds too good to be true. When I was first contacted by Greenway Solutions last week, I was more than a bit skeptical. But after speaking with CEO Jerry Tylman and Managing Consultant Jon Meyer, I was convinced they had something that as a business owner, I'd definitely buy.

The product, EFTGuard, is a joint venture between Greenway Solutions and Royal Group Services. They say it's a "win-win-win" for banks:

  • Helps banks meet "UCC requirement for commercially reasonable security and their FFIEC requirement for customer education and awareness"
  • Provides peace of mind to bank clients
  • Protects both the bank and each client up to $500,000 in unauthorized online transfers
  • Helps differentiate checking and deposit offerings


How it works

EFTGuard provides protection against fraudulent online-account withdrawals of $100,000 per account (with no deductible), with a maximum of $500,000 per customer. And because it's not true "insurance" (it just behaves like it), there is no underwriting hassle and the product can be purchased in just a few minutes via online form (demo here). There is, however, the usual list of coverage exclusions; for example, it doesn't cover insider theft. 

The catch? To qualify, business customers must download and install anti-malware software from Trusteer, Iron Key, or Webroot. And every computer accessing the business account must be running these protective software programs. For the time being, that appears to leave out any mobile access. 

Initially, banks looking to offer EFTGuard will need to work with one of these three malware-protection vendors in order to qualify their clients for the fraud protection. Other than that, EFTGuard is turn-key and comes with marketing support, a co-branded signup page, and full claims management.

The $500,000 coverage is backed by Chartis Specialty Insurance Company.


Bottom line

Your business customers are rightly concerned about fraud. Offering them an option to protect themselves is a great way to differentiate your deposit offerings while preventing you from getting bogged down in messy litigation with your customers.

I still have questions about how often the list of exclusions will invalidate claims when actual fraud occurs. But the company assures me that the protections are very real.

Assuming EFTGuard delivers on its protection promise AND creates a small profit center, what's not to like? I, for one, will be the first business owner in line to buy it. 


EFTGuard homepage (24 April 2012)



1. I believe insurance is one of the best growth areas in retail banking, especially in niche lines that can be explained and delivered online (see our December Online Banking Report for more about banks delivering insurance online).


Launching: Circleup Taps Your Inner Shark Tank

By Jim Bruene on April 19, 2012 5:17 PM | Comments

image If you dream of being Mark Cuban, Mr. Wonderful, or one of other Shark Tank investors (note 1), a wave of new angel-investing platforms are springing up all over the world.

TechStars, a NY-based incubator, said it had more than 30 applications from crowdfunding startups for its summer 2012 class.

In the United States, the recently enacted JOBS Act has spurred interest since it is expected to expand the market to several million more investors. But more importantly, the new legislation will lift the ridiculous "quiet period" rules that are supposed to keep companies from openly soliciting investors (note 2).

Once companies can openly look for investors (expected by early summer), private-placement investment platforms have a lot more to offer to companies seeking capital, namely a marketing opportunity.

Think about it. If you need $500,000 to launch a new line of organic granola bars sold nationwide, would it be better to get it from a couple local angels, or from 100 investor-fans kicking in $5,000 each? The latter approach gives you 100 evangelists in all corners of the country. And with only $5,000 invested, each investor has far less ability to meddle in your affairs.

In the past, the paperwork involved in booking $5k investments made it prohibitively expensive, even if you could find the investors under the old quiet period rules. But the new investment platforms promise to standardize the paperwork, reporting, and sales of small blocks of company shares.

image So, who are the leaders in the space? AngelList certainly, but it focuses on tech only. Of the newcomers, CircleUp which is launching this week, seems to have the most traction, at least measured by press mentions. Co-founder Ryan Caldbeck has recently been featured in the WSJ, NY Times, TechCrunch and the other tech blogs (note 4).

I've been using the beta version for a week, and am impressed. Circleup is focused on consumer products, and three companies are currently featured within the site, raising $100,000 to $500,000 each. I'm itching to drop the minimum investment ($3,333) into one of them just for fun. However, my wife wonders if that will be the same "fun" we had the last time I thought I could pick stocks (note 5). So, I'm still just an observer for now, but a very interested one.

How it works
Circleup is a lot like a simplified version of P2P lending. Companies seeking capital post their investor deck, introductory video, and any other info they deem important to their story. An online forum allows investors to ask questions that the companies can answer publicly (though this was little used during private beta).  

Investing is as simple as clicking on a button, agreeing to the terms, and pledging the funds. Once the minimum investment round is reached, the money is taken from investor bank accounts.

Relevance to Netbankers
If it's allowed to flourish without being crushed by the SEC when the inevitable scams appear, crowdfunding could eventually provide stiff competition in small business lending. Probably not in its current form, where the investments are speculative, ill-liquid equity bets. 

But fast-forward a few years and imagine a marriage of crowdfunding with P2P lending, and with the liquidity issue fixed through secondary markets. Small- and mid-sized businesses could use a crowdfunding platform as one safe source to get a mix of equity, debt, and receivables financing.

Banks should also consider getting involved in crowdfunding by partnering with the platforms to provide debt and other banking services to the small business participants. Banks could even start, or at least invest in, crowdfunding initiatives of their own.   


Company info page
Note: Fictitious listing; note investment button in middle-right.

Circleup company info page

Investing page
Note: For $25,000 (the max allowed), I get 134,000 shares, or 0.51% of the company.
Actual company seeking capital through Circleup, name masked due to the soon-to-be-ending prohibitions against soliciting investors. 


1. Shark Tank is the U.S. version of Dragon Den. It's my favorite show on television, though I don't like how founders are sometimes ridiculed by the celebrity investors, whose egos struggle to fit on the same soundstage.
2. Though Shark Tank, watched by millions on prime-time network TV, demonstrates it's not a well-enforced rule.  
3. Ryan Caldbeck's 10-minute discussion of the JOBS Act is worth watching if you want a quick overview of its impact. TechCrunch covers the launch 18 April 2012 here.
4. Our policy at The Finovate Group is to NOT invest in fintech companies.
5. For more ideas on innovating in the small-biz banking market, see lengthy report on the subject, written 2 years ago.


Launching: SmarterBank, a Virtual Bank Aimed at Student Loan Holders

By Jim Bruene on April 9, 2012 5:50 PM | Comments (2)

image Startups are advised to find pain-points, then build businesses to profitably solve them. Despite the current wave of very bad publicity around banks, especially the big ones, everyday banking isn't a huge pain-point for the 80% of households currently served by existing players.

Sure, I'd like to have more security options, fewer unintelligible messages, and a Cash Tank. But most of these are feature/function improvements, not "must-have" issues that need to be solved.

What are the acute pain points in banking and personal finance?

  • Debt management, especially credit card and student loans
  • Home financing
  • Small business financing
  • Insurance
  • Retirement planning/saving

Three of these five have to do with the debt side of the consumer's balance sheet. Yet, much of the talk about online/mobile banking innovations centers around spending management, payments, checking and savings accounts, and account access technology.

So I get pretty excited about innovations on the debt front. And last week, there was an interesting launch on the student-loan-management front, SmarterBank from Finovate alum, SimpleTuition. Its tagline says it all:

Smarterbank is "the bank that helps you pay down your student loans"

It's a truly free, full-featured checking account, with debit card, paper checks and all the usual (but no branches, of course). And it's powered by The Bancorp Bank, which has its hands in many of the new direct banking initiates we are seeing, including (bank) Simple.

But the special sauce is a built-in rewards program tied directly into student loan payback.


How it works

It's actually two separate accounts, rewards and checking. You don't need to buy the checking account to participate in the rewards program. But you must be in the rewards program before you can get a SmarterBank checking account.

  • SmarterBucks: rewards piece (see first two screenshots below)
  • SmarterBank: the checking account

Users accumulate cash to accelerate student-loan payback in three ways:

  • Deals/offers (note 2)
  • Banking rewards (from linked SmarterBank checking account)
  • Direct contributions from family and friends

SmarterBucks dashboard (8 April 2012)
Note: (1) Link to SmarterBank in upper right
(2)The deals piece is marked "coming soon"

SmarterBuck dashboard with link to SmarterBank from SimpleTuition

SmarterBucks reward activity
SmarterBucks rewards activity screen from SimpleTuition


Sign-up process

1. Sign up for SmarterBucks, which as a non-financial account requires only name and email address

2. Add a student loan that SmarterBucks rewards are credited to

3. (Optional) Add a SmarterBank account so that non-PIN debit purchases earn SmarterBucks rewards

4. (Optional) Invite family to contribute money directly to the SmarterBucks account

SmarterBank application hosted by The Bancorp Bank (link)

Smarterbank application powered by The Bancorp Bank



Marrying rewards, checking/debit, P2P family contributions, and student loan repayment is brilliant. It not only provides a tangible benefit for the 37 million Americans with student loan debt (see note 1), but also is a great customer-acquisition tool for a very important segment, recent college grads. Financial institutions looking for more twenty-something customers should consider building similar capabilities or partnering with SimpleTuition.


1. Figures are from the company. It also said that 10 million students owe more than $50,000, and 2 million owe more than $100,000.
2. Friends and family will also be able to link their own SmarterBucks account to the student's.
3. We covered family/student banking nine months ago in our Online Banking Report (here).

Comments (2)

New Online Banking Report Published: True Virtual Banking Has Arrived

By Jim Bruene on November 3, 2011 9:05 PM | Comments

image I still remember the day in early 1999 when I met with Elon Musk and his 3-person team in a borrowed conference room in Palo Alto. They were plotting the complete and total disruption of the banking industry and fully expected to be one of the largest five U.S. banks by now.    

The startup was named and its original business plan was to acquire one or more existing banks to provide the credibility, and deposit insurance, of a traditional bank. While I was in awe of their ambition, I thought the plan had a flaw. I told them they'd be better off staying virtual, with no bank ownership slowing down their decision making and ability to take risks.

I'll never know if they would have listened to me, because soon thereafter began experimenting with P2P payments via email, and they saw that it was going to be huge. So they jettisoned banking, merged with PayPal, and the rest is history.

Why the reminiscing? That was the last attempt by a major tech startup to take on the U.S. retail banking industry via virtual channels (note 1).

Fast-forward to 2011: At this year's FinovateFall, we saw the launch of not one, but two well-funded attempts at disrupting the incumbents. One through debit/checking/savings and the other through wealth management:

  • BankSimple: DNA from Twitter, analytics, and consulting
  • Personal Capital : DNA from Intuit, PayPal, Everbank and Fidelity Investments

Both companies are what I call True Virtual Financial Institutions, meaning they are complete front-ends to your money, including transaction capabilities and customer service, but they outsource the actual holding of customer funds to fully-regulated partners which pass FDIC/SIPA protections. This allows the newcomers to focus on user experience and service while moving much faster without the regulatory friction experienced by traditional financial institutions.

Others well-known companies using virtual models: Betterment (also profiled in the report), (Plastyc) and Perkstreet.

Note to bankers: True virtual banking needn't be limited to tech startups. These techniques can be employed by traditional companies to expand beyond regional or industry boundaries. The report outlines seven models for doing just that.


About the report

True Virtual Banking Has Arrived (link)
BankSimple, Personal Capital, Betterment and others go branchless,
paperless and "bank-less"

Author: Jim Bruene, Editor & Founder

Published: 1 Nov 2011

Length: 48 pages

Cost: No extra charge to OBR subscribers, $395 for others here


1. I should add that Lending Club, Prosper, Zopa qualify as major entrants bound on disrupting banking from the lending side.   
2. BankSimple, Betterment, Personal Capital and Plastyc FinovateFall 2011 demo videos are available here.


Launching: Cake Health is a New PFM for Healthcare

By Jim Bruene on September 12, 2011 3:59 PM | Comments

image Healthcare expense management continues to be a pain-point for most consumers. Today, Cake Health launched a "Mint for healthcare" which uses similar technology to automatically download healthcare transactions and use the data to manage insurance reimbursements and other aspects of healthcare.  

The company also launched a mobile app that syncs with the desktop version and uses the camera to upload documentation to the system (screenshot below). The startup impressed the expert panel at TechCrunch Disrupt, where it launched today. 



Launching: Openbucks Gift Card Payment Network

By Jim Bruene on September 12, 2011 3:38 PM | Comments

image Today at TechCrunch Disrupt, Openbucks  announced its "gift card" payment network which works like an ATM switch; you can use whatever value you have in a participating gift card to buy something at any participating online retailer.

For example, you could use the $20 in your Subway card (a beta participant) to buy virtual goods at online games. Eventually, they want to expand beyond the purchase of digital goods. 

The product is targeted to those that don't have debit or credit cards, especially heavy game-playing teenagers. "Gift cards" would be added to the payment options at checkout at the gaming site.


MoveNbank: Can it Out-simplify BankSimple?

By Jim Bruene on July 11, 2011 6:02 PM | Comments

image I've been accused of falling for the Bank Simple hype. Just to prove that I don't discriminate, I bring you MoveNBank, a mobile-optimized banking startup founded by Bank 2.0 author and consultant Brett King.

From what little is disclosed on its Facebook page, Twitter feed and Startuply profile I've assembled the following facts:


  • Founded July 2010
  • Private beta to begin soon (per 1 July 2011 Tweet)
  • Soft launch scheduled for July 2012


  • Global startup with HQ in NYC (Madison Square Park, 25 W. 31st)
  • Founder and Chairman is Brett King
  • 8 employees

Product description:

  • Mobile only, with no paper or plastic
  • NFC-enabled app
  • Incorporates "gamification" in UX
  • According to Startuply, "reinventing credit scores and more with an open, social transparent, and viral model" (sounds P2P lending-esque)

Bottom line: MoveNbank is looking to leapfrog the competition by removing all vestiges of old-school banking. No branches (of course). No paper (no surprise). And no plastic (what?).

That's how ING Direct got its start (they did have paper statements), so it's not unprecedented. But if MoveNbank plans on offering payments, it will be harder to pull off. But with a soft-launch still a year away, it should be able to ride the NFC wave expected to roll across the globe in the next five years.

Are there any other remote banking startups I'm missing? Drop me an email (


MoveNbank placeholder page (11 July 2011)



Launching: BillGuard's "Anti-virus for Credit Cards"

By Jim Bruene on May 26, 2011 8:25 PM | Comments

imageFintech made a good showing at TechCrunch's semi-annual Disrupt conference in NYC. Of 32 startups that launched on stage, three were financial-related:

And both InvoiceASAP and BillGuard (discussed below) were selected to come back on the third day and compete, along with four other startups, for the top prize in front of an all-star panel of judges. The judges selected BillGuard runner-up behind GetAround, a clever peer-to-peer car rental service which wowed the crowd, also taking home the People's Choice award. _____________________________________________________________________________

BillGuard overview

The TechCrunch judges and analysts went gaga over BillGuard. Everyone wanted to use the service, and most wanted to invest in the company.

However, the company recently landed a $3 million Series A round (February 2011), so they'll have to wait. Investors include: Bessemer Venture Partners, Chris Dixon, Ron Conway, IA Ventures, Howard Lindzon and Yaron Galai. The Israeli company has 12 employees. The founders are Yaron Samid, CEO, and Raphael Ouzan, CTO.

Currently, BillGuard is free for the first card and can be upgraded to monitor an unlimited number of cards for $4/mo, a classic freemium model.

In the two days following the company's Monday launch, users added 10,000 cards to the alerting service. In the initial scans, looking back through 30 days of transactions, the company identified potential nuisance charges on 20% of the cards analyzed. The flagged transactions ranged in value from $2 to $6,000 with the latter described as "fraud on a very wealthy person's card." ______________________________________________________________________________

How it works

1. Register at the site with just your email address and ZIP code

2. Enter your username and password for a credit card account into the Yodlee-powered aggregation engine

3. The past 30 days of transactions are immediately downloaded and analyzed for potentially fraudulent or unwanted charges (see screenshot 2)

4. Charges are color-coded by risk assessment (green = good, orange = review, red = flagged) (see screenshot 3). Much like anti-virus companies, BillGuard relies on its user base (crowdsourcing) to identify nuisance and fraudulent charges.

5. You can quickly call up the "reviewable" transactions and choose to mark them "good" or wait for more information on the merchant from BillGuard and its user base (screenshot _______________________________________________________________________________


In my case, the service did not find any bad transactions in the 85 it reviewed from my primary business and personal credit cards. All seven marked "unsure" were fine. None were flagged red.

But according to the company, the average American loses $300 per year in unwanted charges, and I'm way over that. Just last year, I lost more than $1,000 because I had the wrong plan on my mobile phone. But that was a legitimate charge from an existing merchant of mine. BillGuard doesn't guard against stupidity, yet, but it wouldn't take a whole lot more intelligence to start flagging this type of out-of-bounds charge as well.

The potential for financial safeguard services is huge. Just look at the multi-billion credit-monitoring industry, or for that matter which alerts users to bank fees and keeps a running total. The question isn't whether consumers want this type of protection, certainly they do. The issue is whether anyone will take the time to set up the service, pay for it, and then take the time to monitor their accounts.

BillGuard knows that and is actively pursuing deals with large banks to package the service into online banking. In its Monday demo, the company said it was in talks with three top-ten banks (on Wednesday they said, "Make that 4").

Distributing BillGuard would be a mixed blessing for banks. Earlier detection of fraud would be useful, but the labor involved in working through increased dispute resolution, especially false positives, would have to be factored in. But again, BillGuard understands the dilemma and is developing dispute-resolution capabilities that will SAVE issuers time and money.

I predict we'll be seeing a lot more from this company so keep them on your radar. I know we will.  


1. Welcome screen after first download & scan (26 May 2011)

Billguard Welcome screen after first download & scan

2. Initial scan results with 7 transactions marked "review"

 2. Initial scan results with 7 transactions marked "review"

3. Transactions are color-coded by risk assessment

BillGuard Transactions are color-coded by risk assessment

4. The transaction review page

BillGuard transaction review page

5. TechCrunch finalist demo (click to watch on TechCrunch site; )



Note: For more on online personal financial management (OFM/PFM), see our Online Banking Report.


Launching: Balance Financial Introduces Hybrid Billpay/PFM/Bookkeeper

By Jim Bruene on March 3, 2011 2:38 PM | Comments

image Internet-enabling every service and device on the planet creates fascinating new business opportunities. And we are seeing our share of them in the fintech space (note 1). Knowing how to deliver the proper blend of personal service and automation is an area of extreme importance to financial institutions: The optimal solution varies by customer, by product, and even by time of day.

One relatively neglected area involves premium services that offer state-of-the-art tech married to specialized human service, for a fee. Large banks have private banking departments that handle the bills and day-to-day finances of households with millions in assets. But those that fall outside the private banking threshold are generally offered free, self-service tools available to everyone.

Back when only 10% to 20% of households were online, that distinction was necessary. But now that 60% to 70% or even more of a bank's households use the Internet, there are enough customers to slice and dice financial management services into a variety of offerings and price points. There's a lot of revenue available for service offerings in the wide range between free and private banking.

Enter the newest player in high-end bill payment: Balance Financial, an angel-funded company based in Seattle that launched its new service this week. CEO Devin Miller was also involved in the launch of one of our favorites new services of 2010, Finsphere's PinPoint mobile location-aware fraud-alert service (previous post).


How it works

image Balance is a unique mixture of automatic bill pay and human bookkeeper, with an online PFM thrown in to help keep track of it all. The company has built a rich PFM, added billpay powered by Online Resources, and given each customer their very own actual person who oversees the account.

Unlike previous generations of billpay and the scan-and-pay offerings from PayTrust and others, Balance Financial does everything for you. It receives the printed or electronic billing statement, it uploads the docs to its website, and then the most important piece, it pays the bills automatically based on your prior instructions, just like the private banking officer. The end user is only contacted if the bill falls outside the preexisting parameters.

Sound too good to be true? Maybe, if it were free, but it's far from it. The company tested a variety of pricing options and settled on a price that's borderline ridiculous for the retail banking mindset: $75 per month.



Are they crazy? Maybe, but probably not. The company has been delivering personal bookkeeping services for seven years, and has paid more than 100,000 bills for its clients (note 3). It knows from experience there are affluent households and small businesses that are happy to offload this task for much more than $75 per month. When paying larger bills, the late fees alone can easily be in this range (note 2).

Balance admits the audience for $75/mo is tiny. But as its technology gets better, and its bookkeepers can take on bigger client loads, it believes it can push this price down, maybe even way down. So if you are interested in finding a new way to serve your mass affluents with something they can't get anywhere else, take a look at Balance.

Balance Financial integrates the human side throughout the Web-based app (3 March 2011)

Balance Financial integrates the human side throughout the web-based app (3 March 2011)



1. From the look of the applications for the upcoming FinovateSpring, the number of startups is growing at an even faster pace.
2. Our record penalty for paying a bill late at our business is $1,100. We'd just made a huge charge and by being that one day late, our APR was bounced to 25%, and we went into revolving mode over two cycles. Even though we paid the balance off within 7 days of making the charge, it still cost $700 one month and $400 the next. Anyway, that one incident alone would pay for Balance for 1.25 years, not to mention avoiding the huge frustration of making a thousand-dollar blunder.
3. The original bookkeeping service was founded in 2004, by Devin's wife, Rebecca Miller.
4. For more on online personal financial management (OFM/PFM), see our Online Banking Report.


Launching: Hearst's Manilla Wants to be Your Online Hub for Bills, Statements, Rewards and Subscriptions

By Jim Bruene on February 28, 2011 7:02 PM | Comments

image Manilla, a new account aggregation service from Hearst Corporation, launched today at Demo. Here's the official announcement and its demo video is embedded below.

Manilla currently aggregates accounts in four categories (more are on the way):

  • Household for keeping track of bills
  • Finance for keeping track of bank accounts and credit cards
  • Subscriptions for keeping track of magazine subscriptions
  • Travel for tracking mileage programs

In the first screenshot below, I've added an account in the finance category (American Express, which is shown as pending) and one in the travel section (American Airlines, which displayed the account balance immediately). I have yet to add a household bill or a magazine subscription.

In the second screenshot, you can see what it will look like after the account has been populated with many accounts (this is an example directly from the Manilla website).

The service will not show third-party advertising. Like Doxo, it will display marketing messages only from participating billers. And also like Doxo, billers will pay the freight, sending the company a small fee for each electronic bill it sends through Manilla (more on its business model here).

As I've mentioned in several posts about Doxo, there is a huge need for a secure, easy-to-use hub to help households organize their bills and statements. While Doxo is currently focused on delivering bills only from participating billers, Manilla allows users to aggregate bills and statements from virtually anyone supported by its Yodlee-powered aggregation engine.

So, if you are willing to sit down and enter usernames and passwords, the service can begin delivering value immediately. Consumers have been reluctant to do that unless they trust the company. But with Hearst Corp. backing it and with the credibility of two major billing partners, Comcast and Citibank, Manilla may be able to get over the trust hurdle.   

1. Initial Manilla homepage prompts new users to add accounts in four categories (28 Feb. 2011)

Hearst's Manilla aggregates accounts in four categories (28 Feb 2011)

2. Manilla homepage after the user has set up accounts
Note: The icons are for bills, statements, notices and offers

Manilla homepage

3. Reminders area

Manilla reminder

Demo video (link)


For more info, see our recent reports: Paperless Billing and Banking and Email Banking: Revitalizing the Channel.


Launching: Will Ebilling Startup Doxo Become a Household Word?

By Jim Bruene on October 22, 2010 4:55 PM | Comments (1)

image The Internet has already yielded some great solutions for a number of modern-day consumer problems.

  • Finding info: Google
  • Purchasing and organizing music: Apple iTunes + iPod
  • Keeping track of your friends: Facebook
  • Booking travel: Expedia and others
  • Getting rid of stuff: eBay and Craigslist
  • Paying for it: PayPal
  • Tracking your money: Online banking

But despite all these advances, does anyone feel like they are more organized today than they were 10 or 15 years ago? Most of us still deal with stacks of paper bills, receipts, statements, privacy notices, along with emails, alerts, and the occasional voice message from our service providers. And if we forget to pay someone, the financial consequences can be huge. So, it's no wonder we decide to keep the paper statements coming to help us remember to pay each bill. 

The company that solves the paper-based "organizational mess" could be the next big thing online. While it's way too early to project a winner, a Seattle-based startup launching this week has as good a chance of taming the paper beast as anyone I've ever seen. The company is Doxo, which I wrote about briefly this summer (see note 1 for invites). The company's DNA is Qpass, an early billing and payments company sold to Amdocs in 2006 for $275 mil. Co-founders Steve Shivers, Mark Goris and Roger Parks all worked at Qpass.

Here's Doxo's service in a nutshell, using the Facebook metaphor:  

  • Create a secure place online where bills can be stored; let's call it
  • Allow authorized biller "friends" to communicate directly to their customers via, this includes sending the bill itself, plus customer service and marketing communications
  • Once the biller and end-user are friends, turn off the pesky paper statements and store everything forever, for free, on the platform

The business model:

  • Consumers pay nothing
  • No advertising (other than marketing message from biller "friends")
  • Billers pay for the entire platform since it costs them a fraction of what they pay today sending paper bills and processing payments

Why would billers pay for it?

  • It's a fraction of the cost of paper + postage
  • Adoption of estatements has stalled at 10% to 15% of consumers even for billers who've worked relentlessly to get rid of paper; and the easy way to get adoption, charging for paper statements, gets both consumers and politicians all worked up
  • The Doxo platform provides a direct, secure communications path to end users, including marketing messages
  • No advertising from competitors makes Doxo more desirable than other third-party systems where billing info might end up residing (e.g., Google/Gmail, Mint, etc.)
  • The network effect; managing multiple bills in one place is the carrot to get consumers to give up the paper

What's missing?

  • Billers are not yet on the system in this private-beta release (note 1). Users can set up pages for each biller and populate it with their account info and uploaded statements. This is a temporary limitation; I've been assured that some big-name billers are on the way.
  • It's currently a read-only system, meaning there's no way to pay the bill. Eventually, it makes much more sense to allow customers not only to receive the bill, but also to pay it from within Doxo.

Why it could be huge: This is a classic "network" play. The more billers on the system, the more the consumer benefits and vice versa. Whoever gets this system to scale first will enjoy an enormous "eBay" network effect which will be difficult to dislodge. CheckFree/Fiserv and others have been down this road but have not achieved critical mass, leaving the door open for an aggressive startup to fill the void.

I like what I see at Doxo. And not just its slick UI. I've interviewed company execs several times and they have this thing nailed, at least in theory. The user-experience is great, assuming the startup brings in the billers. And the biller's business case is a no-brainer, if Doxo scores the end-users. We'll know it has a good shot when a half-dozen big-name billers come on board.   

Why it could lose: Consumers are absolutely not looking for another place to manage their bills. And very few care enough about it to do a lot of work populating a website with account info. Finally, until the portal develops a recognized brand, users won't trust it. It's critical that a few big billers endorse Doxo to get it jump-started. Even then, end-users may simply not be willing to spend the few minutes it takes to get set up on Doxo. 

Bottom line: I love it and want all my bills to go here now. So here's to being able to "doxo" statements to me sometime very soon.    


Electronic biller page at Doxo for fictional Goliath Bank (21 Oct 2010)
Note: The "To Do" tab is where account statements are delivered

Electronic biller page at Doxo for fictional Goliath Bank

Doxo inbox for receiving statements and other communications

Doxo in-box for receiving statements and other communications

Doxo storage area for filed statements
Note: Users can upload their own electronic documents to supplement (or in lieu of) those received through the Doxo platform

Doxo storage area for filed statements

1. The company has tweeted that it will hand out invites to its followers on Update: Doxo sent us some invite codes, use "netbanker" as your access code. 

Comments (1)

Mobile Phones Just Keep Getting Smarter: Now Used as an Electronic Key Card at Holiday Inns

By Jim Bruene on September 22, 2010 8:33 PM | Comments (1)

imageI love September. When I was a kid it was the excitement of going back to school, a new football season, wonderful Midwest weather, plus my birthday to boot.

Nowadays the birthday isn't so much fun, but the weather is still fine and it's like Christmas for new tech products. I can't prove it, but I bet there are more major product announcements in Sep/Oct/Nov than the rest of the year combined. 

This month already, 70 new tech products launched at DEMO last week, and several dozen will debut at TechCrunch Disrupt next week. Then, of course, we have 56 new financial launches at Finovate, Oct 4/5 (which unfortunately is sold out).

Today alone, there were at least six new things I would have liked to blog about. Maybe I can get some of them into my Twitter feed at least. I have chosen the one that was the biggest "aha" moment of the day. The seemingly off topic, but oh-so-cool service, that can turn any mobile phone, yes even those low-end freebies, into an electronic hotel room key. And without any additional hardware/case/SIM/SD card or anything. It's like magic. Watch.

They use sound to engage the lock. Aha! Would I trust the thing? Probably not, but I'd use it anyway. The key benefit (pun intended) is that you get to bypass the endless lobby check-in queue when you arrive at the hotel and simply proceed directly to your room. For that, I'd take the risk that it didn't work. Besides, four times in my life I've been given a key card at the front desk that opened up on a room already occupied (see note 1), so this system can't be any worse.

The system, called MobileKey, is being piloted for the next three months at a Holiday Inn in Chicago and Houston. It's powered by OpenWays. When using the service, the hotel sends the guest a text message with a link that plays a unique sound that opens the door. Brilliant! 

Relevance: When your phone becomes your Starbucks card, then your airline boarding pass, and now your hotel room key, it's only a matter of time before it becomes a mobile wallet, not only controlling your bank accounts, but also used at the point of sale for purchases. 

1. Does this happen to everyone or am I just cursed? At least three times the door was not deadbolted from inside, so I actually went partway in to the room. Once I was politely told to go away, once I was screamed at by a fellow whom I'd awakened after midnight, once the occupant was in the shower so I quickly backed out, and the fourth time there were dishes out front so I called the front desk first. Anyway, I always knock before going into my room the first time.  
2. HT ReadWriteWeb

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BankSimple May be First Invite-Only Retail Bank Launch

By Jim Bruene on September 14, 2010 2:54 PM | Comments (3)

The Bank nightclub, Las VegasI'm not sure what BankSimple told investors, but it worked. The non-bank bank startup grabbed $3 million in VC money last week. The company is positioning itself as a tech company rather than a financial services provider, a smart move for valuations.

imageI finally caught up with co-founder Joshua Reich a few days ago. I came away from that conversation even more impressed. These guys are really trying to reshape the banking experience. They talk more like a credit union than a bank, meaning they are maximizing the customer experience instead of the shareholder one (see note 1).

Granted it hasn't launched yet, but so far the "better experience" strategy is working wonderfully. The startup has a 20,000-person wait list for an account. Think about that, a waiting join a bank. I never thought I'd write that sentence. If 75% convert to actual customers, BankSimple will have already hit its first-year goal. A nice problem to have.

Graphic from BankSimple website

And the beauty of so-called scarcity marketing is that you can use invite codes as a sort of virtual currency to reward existing customers and other influencers. BankSimple plans to use invite codes to encourage certain unspecified behaviors from existing customers. It's a page out of the Silicon Valley playbook. Google kept Gmail invite-only for several years. There was a even a time where people paid real money on eBay for a Gmail invite. The same could happen at BankSimple. 

Other things I learned:

  • 42% of its prospect base already uses Mint, so BankSimple is content to let someone else handle the heavy lifting in the aggregation space. At launch anyway, they will show activity only with direct BankSimple partners. 
  • As previously reported, the bank is committed to mobile remote deposit. They've spent considerable time working the kinks out of that. They even looked at extending the concept to bill payment, allowing users to simply scan bills and have them automatically paid; however, too many tech problems surfaced, so the effort has been shelved. 
  • Focused on real-time everything. They may be the first bank (at least in the United States) to have everything they do occur in real time. They think that will greatly reduce customer service headaches and expense.

1. But clearly BankSimple is no nonprofit. The VCs are there because they smell a 10x return, not because they don't like banking fees.
2. Photo credit: The Bank nightclub in Las Vegas.
3. Previous posts on BankSimple here.

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Categories: Bank Simple, Launches

New Online Banking Report Published: Email Banking - Revitalizing the Channel

By Jim Bruene on August 23, 2010 4:44 PM | Comments (3)

image Each day, the typical consumer household completes several banking and credit/debit card transactions. And 99% of the time, the transactions require little extra attention other than mentally checking them off to ensure you aren't a victim of fraud, or more likely, human error.

But to stay on top of that routine activity, Americans collectively make hundreds of millions of visits to banking websites each month. This, my friends, is not an efficient use of time.

And it's mostly unnecessary. There's really no reason to log in every week to manage my accounts. All the info I really need could be sent to me via email.

That would eliminate the need for most website visits. And if I could initiate transactions right from the email, I'd only need to visit the website every few months to tweak my settings (even that could potentially be done through email interactions).

But as pervasive as email (and text) alerts have become, they are often cryptic messages that make you feel less certain of your finances, creating more anxiety and more website visits (see note 1). This is not what you want from financial providers.

What's missing is a rich email experience, where a balance summary message can be expanded into a full statement with the click of a link. Where key supporting actions, such as paying a bill, are imbedded in the message. And where it's easy to resolve issues immediately while you are thinking about them, rather than moving to another channel later on.

That's the promise of Email Banking that we explore in the current report (see below). We also look at a new Israeli startup, ActivePath, that is delivering much of this vision with its new email banking service launching in the U.S. later this year (note 2). The screenshot below shows how a password-protected daily account-summary email can become a full-featured account-management tool with numerous links to act on the information presented. 

Finally, in an addendum to last month's report on email/text alerts, we look at the alert-control panels at five major banks: Bank of America, Capital One, Chase, U.S. Bank and Wells Fargo.

About the report:


Email banking: revitalizing the channel (link)
New technologies and more thoughtful design could elevate email
to a central role in account management

Author: Jim Bruene, Editor & Founder

Published: 19 Aug 2010

Length: 40 pages

Cost: No extra charge to OBR subscribers, $395 for others here


Daily account summary email from ActivePath
Note: Embedded buttons to a.) view transactions, b.) role money into a CD,
c.) transfer funds, d.) view transaction detail, e.) chat with customer service


1. For more on email alerts, see last month's Online Banking Report: Email Alerts & Transaction Streaming.
2. See ActivePath, along with 55 other innovators, at FinovateFall, Oct. 4/5 in NYC.

Comments (3)

Launching: Doxo Looks to Dramatically Improve the Ebilling Experience

By Jim Bruene on August 19, 2010 5:51 PM | Comments (4)

image Two significant Seattle-based financial startups are gearing up for launch, something I haven't been able to say since the bubble days. We looked at location-based transaction monitoring company Finsphere last week. Today, we take a peek at Doxo, which is looking to disrupt the ebilling market and bring transactional paper mail into the 21st century.

I met with CEO Steve Shivers and Marketing VP Kevin Frisch last week in their new Pioneer Square office, a nifty location recently vacated by Microsoft. While public details are limited, I've had two briefings with the firm and can say that if it works, it could be one of the biggest financial plays in many, many years. Like Finsphere, Doxo is backed by Mohr Davidow Ventures and Bezos Expeditions.

Of course, the ebilling space is littered with failures including many well-funded ventures that pretty much all ended up being acquired by CheckFree (now Fiserv): MSFDC/TransPoint (Microsoft, First Data, and Citibank), Spectrum (Wells Fargo, First Union, and Chase) and Integrion (IBM and 17 banks) to name just a few. And the ebilling service at Fiserv isn't exactly blowing the doors off, delivering 320 million bills each year (2009), just a sliver of the 40 to 50 billion sent annually in the United States.

All I can say about the startup is that they are creating an online hub where billers can send bills and communicate with customers in a much better way than through snail mail. It's put together in a way that could really speed estatement adoption. And it's funded by the billers, who save money immediately by eliminating paper statements to participants.

As demonstrated by the history of failed ebilling ventures, there are huge obstacles to overcome. But the time may be right for ebilling to finally take off. Billers are frustrated with low levels of estatement adoption, consumers are fed up with redundant email and paper communications, and no one wants to waste natural resources (and money) if there's a viable alternative.

No one has yet figured out how to solve it. Doxo may have the answer. Stay tuned.

Comments (4)

Launches: Swipely is a Yelp/Twitter/Bankcard Mash-up

By Jim Bruene on June 8, 2010 3:44 PM | Comments

image This week I received an invitation to Swipely's closed beta (request one here). As a fan of its closest competitor, OBR Best of the Web winner, Blippy (note 1), I've been looking forward to testing out the newest entrant. 

Both services allow you to register ecommerce accounts, including credit or debit cards, so that transactions can be streamed to your friends and family, or the whole world if you so choose (note 2). Detractors cannot figure out why anyone would want to do that, but that's also what people said about Twitter, which is now approaching 200 million worldwide monthly visitors

But I'm convinced the naysayers simply haven't used Blippy or Swipely. The startups are simply convenient platforms for sharing interesting experiences, downloads, or purchases. It's not the collapse of privacy as we know it (that would be Facebook). The typical Blippy/Swipely user might stream their Netflix queue, iPhone downloads, or a meal eaten at a local favorite.

Contrary to what you might read, there is very little oversharing. Generic posts such as "spent $7.29 at CVS" are rare. Sure those people exist, just like the Twitter users sharing what they had for breakfast, but they are the exception. Like Yelp or Facebook, most users strive to share things that are interesting to both them and others (note 3).

Providence, RI-based Swipely, which has already raised $8.5 million in capital, encourages users to comment and rate purchases on a 5-point scale. If it catches on, Swipely could build a database of user experiences and merchant ratings that challenges Yelp or TripAdvisor (note 4).

Bottom line: Will the services prosper? I think semi-automated transaction sharing is here to stay and will become a standard feature in larger social communities, e.g., Facebook, Twitter and Yelp. It also makes sense as part of larger OFM/PFM efforts (note 5).

I also think there is a place for limited transaction sharing among customers of financial institutions, primarily among joint account holders and employees of smaller businesses (see previous post).  

On the other hand, I'm not sure if Blippy/Swipely will become popular destinations on their own. It's more likely they'll end up powering services baked into other sites. That said, if the startups can figure out how to get the Internet masses to make the effort to rate and post millions of transactions, they could become household names.  

Swipely transaction stream across all users (7 June 2010)
Note: My just-posted transaction is at the top of the stream


1. See Blippy's FinovateSpring 2010 demo here; see previous posts here.  
2. Swipely doesn't currently support direct downloads from ecommerce accounts, but you can forward email receipts to the service for posting.
3. Both services offer a mix of automation and manual entry to make sure the posting process isn't too much of a burden, but keeps things relevant. On Swipely, the default privacy setting is for the user to manually approve each transaction before it is posted. And in contrast to Blippy, the amount of the transaction is NOT included in the post.
4. You can understand why the VCs are investing.
5. See our most recent Online Banking Report for more on Online Financial Management Features for Online Banking.


Lifehacker, Bank Technology News Spread the BankSimple Meme

By Jim Bruene on June 5, 2010 8:34 AM | Comments

imageBankSimple has already become well known among the digerati and its notoriety is spreading to the mainstream press (here and here). Bank Simple's latest PR coup was being named Tuesday to the Bank Technology News annual top-20 innovators list (see note 1).

Quite a feat for a company that hasn't yet launched or even shown its service outside a small group of testers (note 2).

Lifehacker Asks, "Are you happy with your bank?"
Lifehacker, a popular blog (note 3) that deals with personal productivity and other minutiae of day-to-day living, positioned the BankSimple story as a backlash against traditional banks in a post titled, "Are You Happy with Your Bank?"   

imageAfter a few speculative paragraphs about Bank Simple, the blog concluded with a quick poll to see how motivated its readers were to switch banks. I expected this self-selected sample to be very anti-bank. But surprisingly, more than half the 3900 voters declared themselves relatively satisfied with their bank. Only 13% said they were unhappy and another 30% said they'd consider consider switching.

Given the sample bias, you can't read too much into the the data. But it does demonstrate that even in a worst-case polling situation -- where participants are pre-conditioned with a vision of a utopian entity that does everything right with nary a fee -- it's still difficult to budge consumers away from their existing bank/credit union.

1. Four recent Finovate alums were also listed: Backbase, CashEdge, Intuit, and Segmint (see our Finovate blog post yesterday).
2. If you read all the published articles, a fairly thorough picture of Bank Simple emerges. It will not be a bank, but a simple web 2.0 interface (e.g., Twitter/Tumblr) on top of a checking account (e.g., what PayPal did for online payments ten years ago). 
3. According to Compete, Lifehacker averages about 1.2 to 1.5 million unique U.S. visitors each month.


Launches: Piggymojo Taps Twitter and SMS to Track Everyday Savings Success

By Jim Bruene on June 1, 2010 10:25 AM | Comments (1)

image Who hasn't played this game? "If I give up x, I can justify buying y." At our house, after two decades the game is mostly now limited to big-ticket items. For example, "If we don't replace our 11-year old Toyota, we can take a summer trip to the U.S. Open."

The basic premise is that the extra three grand you DON'T spend on the new car essentially pays for the vacation, making it seemingly "free" and more guilt-free. It's a common and powerful principal of consumer behavior.     

Piggymojo's just-launched service taps into this psychology and gives it a mobile twist. The startup uses text/Tweet-based data input so it's easy to track all the expenses you've avoided during the day. And because it takes just a few seconds to tap out a message, the principal can be used to track even trivial daily savings that can add up over time.

For example, if you decide to start brown bagging lunch instead of hitting your normal lunch spots, you can track the savings by Tweeting/texting to your Piggy Mojo account:

Packed own lunch, saved $5 (or on Twitter, "d piggymojo 5 lunch not out")

Drank free office coffee, saved $2.75

Read office newspaper, saved $1

The service collects all these messages and tracks the total amount "saved." The totals can be applied to various savings goals to measure progress. The site uses a unique photo mosaic to visually represent goal progress. You can choose from dozens of exisiting photos or upload your own. As you build your savings, the photo gradually fills in until it's complete (see screenshot below).

You can add your spouse/partner to the account so both of you can contribute towards the savings. There's also a way to set up "recurring savings" so you don't have to constantly text repetitive items. For example, if you cancelled your cable TV, you can input the amount saved once at the Piggymojo site and it will automatically credit your account each month (see second screenshot).

There's also a social piece, allowing you to bring friends and family into the fold. Piggy Mojo will automatically send them a weekly progress report on your goal, providing that all-important peer pressure to your spending discipline.

Relevance for netbankers
Currently, the site is not hooked to an actual bank/CU savings account. The user is responsible for actually moving these fictitious savings amounts to a real savings account for later use. But this concept would be much more powerful if every time you texted "saved $6 at lunch" that six bucks were actually transferred from checking to savings.

Piggy mojo goal-tracking via completing picture of your goal (1 June 2010)
Note: The arrows point to the color sections that have been completed, visually demonstrating that I'm about 7% of the way to the goal


Recurring savings input form


1. HT: Credit Karma blog
2. For more info, see our Online Banking Report, where we wrote about various ways to leverage your online/mobile channel to boost deposits in late 2008 (here).

Comments (1)

What is Bank Simple?

By Jim Bruene on May 18, 2010 8:20 AM | Comments (1)

image There's a new "banking entity" in formation, Brooklyn, NY-based Bank Simple operating (temporarily I assume) at the .net version of its name <>. I chatted with the founders, Josh Reich and Shamir Karkal earlier this year and am anxiously awaiting more info on the launch.

From reading its trademark application, website, and blog, I have a feeling Bank Simple will launch as a banking front-end (eg. Mint, Obopay), and not as an actual bank. Given the market's (and Washington's) appetite for startup banks right now, they may have little choice. But who knows where they go from there. It sounds like they want tight control over the user experience, so they may eventually need to be a bank.

But from their FAQs and a few tidbits found through deep Googling, it sounds like Bank Simple will be much more than web-based software. Initially, it is launching a card-based service with combined debit/credit and rewards built in (de-coupled debit again?). Here's what they say in the About section:

We will launch later this year with a simple card with in built checking, savings, rewards and a line of credit. As we add more competitive banking services, you can personalize your features as your needs change.

Bank Simple talks about customer service (answering the phone), taking deposits by mail (and this is a rumor, by mobile remote deposit) and other traditional banking activities. So that is much more than an online PFM (can we agree to call that OFM?).

They made the tech press this week when they added a new co-founder, Alex Payne, one of early engineers at Twitter. So expect streaming information, ala Blippy and Swipely, and social networking to be a crucial part of the mix.

The startup is looking for summer marketing interns, but there are no permanent jobs posted, another reason to believe they will not be operating a full-blown bank in the near term.

It sounds like a good plan. Marry the utility of PayPal with user experience of ING Direct. Throw in a little Mint-like design and some Twitter hype, and it's a VC's dream. 

Bank Simple's pre-launch placeholder homepage (18 May 2010)
Note: Site is in closed beta, request an invitation through the "join" button


Note: In Online Banking Report, we have written about creating a virtual bank, sans the charter, several times in the past 15 years. The most recent full report was in Oct. 2000, Creating the of Financial Services. But we updated the tables (now called Creating the Facebook of Financial Services) last year in our 2010 Planning Guide.

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Now That's Payments Innovation: Parkzing Puts Your Parking Tickets on Autopilot

By Jim Bruene on April 18, 2010 9:52 AM | Comments (1)

image When talking about payments innovation in the 21st century, PayPal is usually the first thing that comes to mind. The company took existing payment methods (debit, credit, and electronic/ACH transfer) and used the Internet for delivery and messaging. Ten years later it is one of a handful of financial companies that can claim nine-figure customer bases. 

And there are dozens (hundreds?) of companies working on creating their own PayPal in relatively new frontiers: mobile, social networks, health care, micropayments, and so on. We'll have several of them demoing at our upcoming FinovateSpring event May 11 (lineup here).

image But you don't need millions of users to create something of value. Case in point: Parkzing is a new service (with a great name) created in his spare time by Aren Sanderson, CTO of Third Ave Labs, the creator of mobile app discovery service Apptizer (great name #2).

Parkzing is a mostly free service that removes the hassle, and worry, from remembering to pay your parking fines. How it works:

  • Users register their license plate number with the service
  • Parkzing scans city parking fine databases daily
  • If it finds a match, it contacts the user with a reminder to pay; reminders continue until the fine is removed from the database
  • Optionally, users can give Parkzing their credit card number and the ticket  will automatically be paid for a very economical $5 per ticket fee (see note 1)

This is one of those ideas that is so simple, yet so valuable, that you cannot believe it wasn't invented the day that city databases went public. As you might suspect, not all cities post this info online, so it currently only helps those in San Francisco, Washington D.C. and NYC (request your city here).

Relevance to Netbankers: This would be a valuable service to offer online/mobile banking customers. It would differentiate you from the competition, help fill your city's coffers, and add value to your payments card(s). The main downside? Liability for technical glitches that cause fines to go unpaid. A nominal fee for the service could fund a payments guarantee and provide a small bit of revenue.   

Also, think about the bigger picture here. Why limit this to parking tickets? How about if my bill-pay provider scanned all my accounts every day and told me what I owed? Utilities, credit cards, school lunch account, the dentist, and so on. To some extent Mint, Yodlee and the other PFM/bill-pay players already do this. But as Parkzing demonstrated, there's still room for innovations in bill pay. 

1. Five bucks is incredibly low considering the convenience and the savings in late fees; in Seattle we owe an extra $25 after only 15 days. I'd be willing to pay $25 per year + $5/ticket for the service.
2. HT to VentureBeat for writing about it. 

Comments (1)

The Second New PFM of 2010 Launches at DEMO: In & Out Cash Management Systems

By Jim Bruene on March 22, 2010 11:47 PM | Comments (7)

imageTwo weeks ago, we wrote about the first PFM in the class of 2010, HelloWallet. Now we have the second entrant: In & Out Cash Management Systems at <> (press release). I had a first-hand look at the new program at the company's booth at DEMOspring 2010 today in Palm Springs, CA. The company makes its debut tomorrow morning on the show stage (video will be released later this week).

The Yodlee-powered PFM concentrates on financial fitness with built-in coaching and a dashboard of ten financial-fitness measures, such as overall savings and credit limit utilization (see inset below).

imageTargeted to the younger, 18-to 35-year- old segment, the site includes social features and awards points based on taking positive financial steps and exhibiting fiscal responsibility. In the future, award points will be redeemable for various financial offers and merchandise discounts. A virtual game-like environment is also on the planning board.

The company behind the new service is Value-Centered Solutions, a 19-person, San Pablo, CA-based startup launched in 2006 by founder and CEO Michael E. Parker.

The company is planning a free ad-supported option, along with a $9.95/mo ad-free premium version.

Finally, InOutCash is being pitched as a money-making opportunity for those joining a separate $60/yr program at sister company, (second screenshot).

My take: The product looks strong and the company has some novel ideas about social aspects, rewards, and monetization. But all the talk about the "business opportunity" takes away from the site's focus on helping less-sophisticated users get a handle on their spending and debt. I'd like to see them ditch the make-money-fast piece and focus on building a solid Gen X/Y PFM. homepage (22 March 2010)


The product is also being pitched as a money-making opportunity


Note: For more information on the PFM space, see our Online Banking Report on Personal Finance Features.

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Launching: HelloWallet is First New PFM of 2010

By Jim Bruene on March 8, 2010 3:15 PM | Comments (4)

image During 2008, we tracked more than a dozen new PFM launches. But it's been quiet since then. The last major launch was Thrive (now part of Lending Tree) at Finovate 2008. However, with Mint exiting with a $100+ million gain late last year, the space is bound to heat up again. 

It's not like there isn't room for quite a few entrants. The United States supports 15,000 banks and credit unions; there's no reason why there won't be dozens of successful PFMs.

imageThe latest entrant, HelloWallet officially launched today (press release). While its features are similar to others, it has one claim to fame that's tough to beat, an endorsement from a former U.S. president. According to a Sep. 2009 BusinessWeek article, Bill Clinton, singled out HelloWallet in his address to the $20,000-per person Global Initiative event in September.

The for-profit site founded by former Brookings Institute fellow, Matt Fellowes (Brookings archive; inset with Bill Clinton), has attracted the attention of both politicians and foundations with its mission to:

...democratize access to honest, high-quality financial guidance for everyone.

HelloWallet appears to be an advertising-free business model with moderate $5/mo (or $48 annually) fees covering its costs. It's also being distributed free-of-charge through institutional partners such as The Rockefeller Foundation.

The startup has pledged to give away one subscription to a lower-income family for every five paid ones. That's a smart strategy, especially when what is being given has essentially zero marginal cost to deliver. HelloWallet's features include:

  • full account aggregation so you can track all your financial accounts from one dashboard
  • financial tools for investing, saving, reducing bank fees, and so on
  • banking price comparisons
  • budgeting tools
  • bank-fee and credit-card-APR monitoring services
  • goal-based savings

My take: I kicked the tires a bit, successfully setting up automated access to my checking account, and manually adding a few more assets. But the site was a little buggy today, hitting me with error messages and delivering dead links, so I'll hold off judgement until they get things stabilized. But it looks like a well-funded and promising effort so far.

HelloWallet homepage on launch day (8 Mar. 2010)


Note: For more information on the PFM space, see our Online Banking Report on Personal Finance Features.

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Launches: Kwedit Allows Gamers to Pay for Virtual Goods with Real Credit

By Jim Bruene on February 4, 2010 6:24 PM | Comments (3)

image From a financial innovations standpoint, 2010 is off to a great start. Just 35 days into the year and we've already had two launches of services I don't think anyone saw coming: Blippy to automatically stream your purchases to the world (previous post) and now Kwedit (say it out loud if you don't get it).

Kwedit is designed to be the payments engine for the massive virtual goods market, estimated to be $1.6 billion in 2010 according to, up from $1 billion in 2009 (cited by GamesBeat last week).  

imageMany of the gaming networks, especially the so-called "social gaming" startups such as Zynga's FarmVille, appeal to teenagers and younger kids (note 1) who don't have credit or debit cards available to pay for virtual goods. This has made it difficult for the publishers to monetize the games through direct payments.

How it works:

1. Users of games partnering with Kwedit can purchase in-game virtual goods by promising to pay later through their associated Kwedit account. See the screenshot below to see how Kwedit is positioned in the online game FooPets.

2. Later, users print out a bar-coded coupon from their Kwedit account (see inset right) and take it to a participating 7-11 convenience store and pay via cash, mail payment imagedirectly to Kwedit, or "pass the duck" and send the IOU direct to their parents for payment. The site also offers an option to pay directly via credit or debit card.

3. To help drive off deadbeats, the company has created a Kwedit Score that shows which users are paying their IOUs on time (inset left). At FooPets, users will get more virtual goodies as their Kwedit Score increases, creating a game within the game and a way to promote responsible spending. 

I'm not a gamer myself, but as a parent, I understand the pull of online games and look forward to the day when I don't have to hand over my credit card for use on some site I barely understand. Some will argue that Kwedit needlessly encourages credit use in the pre-teen set (note 1). But as long as parents stay involved, Kwedit can actually be used to teach kids the importance of paying their bills.

So, if users take this option seriously, by paying down their virtual debt with real money, Kwedit could be huge (in which case, PayPal buys it of course). And it's relatively low risk for the gaming companies because the virtual goods have a zero marginal cost. BillMyParents is another company we've covered in the teen-payments space.

There is no doubt in my mind that online gaming needs a better payment system and that the solution is unlikely to resemble anything us parents have ever seen or imagined. Kwedit fits that bill. 

Kwedit gets star billing on the main screen at FooPets (4 Feb 2010)


Users create a promise to pay using a popup screen served by Kwedit (link)
Note: Users first must log in to their Kwedit account from this popup


1. Kwedit users must be 13 or older to sign up for an account.

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Citibank, Microsoft Join Forces with Bundle, a Personal Finance Site with a Data Bent

By Jim Bruene on January 29, 2010 5:21 PM | Comments (1)

image I had been intrigued about rumors that Microsoft and Citibank were partnering on a joint personal-finance venture called Bundle. I was hoping for the financial services version of an Apple launch.

OK, that's a little too high of a bar to set. I was really just hoping for the next Mint or at least something we hadn't seen before. To some extent, Bundle delivered, with Mint-like attention to design and deeper data than we've seen previously. But in other ways it's just a me-too personal finance site, FiLife 2.0. Bottom line, Bundle has been open only a week so it's way too early to predict where it's going or how it makes money. 

imageBundle is a personal finance startup backed by Citibank, Microsoft, and Morningstar. Two of the key execs, including CEO Jaidev Shergill, are from Citi Growth Ventures, the group charged with commercializing products and ideas that have bubbled up within the banking giant. The startup also enlisted professional journalists, including Janet Paskin who's written for Dow Jones's SmartMoney Magazine among others.

Given that pedigree, the new site is kind of a SmartMoney Magazine meets your credit card statement with some social networking thrown in the mix.  

What distinguishes it from most personal finance content providers is that Bundle showcases proprietary data, sourced from Citibank's massive card-spending warehouse. The site gives center stage to data and shows household spending personalized to your specific location.

There's also professional personal finance advice mixed with stories and comment from the community. Even the articles use the database to illustrate points (screenshot 3). 

image Naturally, it's well-integrated to Facebook. You cannot even comment unless you log in via Facebook Connect. You can follow Bundle on Twitter, of course, but surprisingly there is no blog or RSS feed.

And Bundle already has its own iPhone app called Vice Tracker (iTunes link) that makes shopping for non-essentials into a tongue-in-cheek game. The unique app was added to the store two weeks ago in the Lifestyle category. 

According to the FAQs, Bundle's business model is advertising, but there are no ads on the site yet, other than the logos of the backers (Microsoft is using its MSN Money brand). Presumably, they are looking for financial advertisers, but the Citibank connection might make that a harder sell.

I like what Bundle is doing, creating a consumer-facing company around Citibank's cardholder data. But I can't figure out who they are targeting. Maybe they haven't decided yet.

If they want to attract data junkies like myself, the data needs to be more transparent and they need more robust tools to play with it. I enjoyed being able to compare the spending of my Seattle neighbors against that of my home town in Iowa (it's surprisingly similar). But I was left with a number of questions: 

  • Where does the spending data come from? The FAQs are vague on saying that it comes from Citibank card data, government sources and "other third parties." 
  • If it's primarily Citibank card data, is it really representative of the entire town or just the people that hold Citibank cards? For example, Bundle tells me (screenshot #3)  that the average dining out expense in Seattle is $115 and the most common spot is Starbucks followed by McDonalds. Something seems wrong with that.  
  • And furthermore, are these estimates of all spending or just that on Citibank cards? And which Citi portfolios are included? What about business cards?
  • The graphical bubbles are nice, but I like to view data in tables, especially when trying to drill down and do meaningful analysis. Is there some way to see the underlying numbers?

On the other hand, if Bundle is trying to attract readers looking for personal finance advice and discussion, the data is kind of in the way, more window dressing than anything else.

Final thoughts
The graphics are great and the spending data is interesting. But why would I come back? There's only so many times in one's life that you want to compare the shopping habits of your city vs. somewhere else.

Presumably, future versions will allow you to compare your actual spending to the Bundle averages using account-aggregation technology. This is a popular feature of Wesabe, and is one of the major tenets of what we've called "social personal finance" (note 1, 2).

I also expect they'll integrate Bundle into the Citibank cardholder site so its customers can do online comparisons while they are checking their statement online.  If Citi can document a spending lift from bundled Bundle, then the startup has proven its value. Armed with that success, it could be licensed to other big card issuers, increasing the value of the Bundle data for all users, attracting more users and more advertisers. The network effect. Perhaps that's the end game here. 

#1: Main Bundle page after selecting "Seattle" as location to show spending (29 Jan. 2010)


#2: Main page after drilling down through the "Food & Drink" bubble (link)
Note: Top five restaurants for dining out in Seattle are Starbucks, McDonalds, Subway, Red Robin and Cheesecake Factory. That sounds possible, but then the average purchase size is listed at $115. That's a lot of lattes or Big Macs.


#3: The ever-present "spending balls" hover above an article by Bundle Managing Editor Janet Paskin's short post. The balls compare the spending in Brooklyn with her hometown Seattle 
Note: Brooklyn comes out cheaper, see the solid circles (Brooklyn) in front of the cross-hatched ones (Seattle).


1. See our previous reports on Social Personal Finance (2007) and Online Investment Communities (2008).
2. Wesabe would seem to be a great acquisition if Bundle wants to add the aggregation technology piece and jump-start its user base.  Blippy-like features would also make the site more sticky.
3. For more background on the software tools being used, see the article on Bundle in Microsoft's Financial Services publication published 22 Nov. 2009.

Comments (1)

Blippy Demonstrates the Power of Real-Time Streaming of Financial Transaction Data

By Jim Bruene on January 25, 2010 5:59 PM | Comments (2)

image Blippy has been one of the more controversial financial entrants in the past few years. Observers have called it the "end of privacy as we know it," a way to take "oversharing to a dizzying new level," and a "great tool for phishers." And those are just the people who like it.

Blippy, a kind of Twitter meets Yodlee service, allows users to stream their purchase activity to the startup's website. Users can choose to publish data from credit and debit cards, bank accounts, and/or directly from purchase activity at ecommerce-partners sites (see list below). It's the ecommerce transaction stream that provides the richest data describing the actual product purchased or rented rather than just a dollar total.

For example, here's an entry from @Julia who's connected her Amazon account directly to Blippy (note 1)  As you can see the Amazon purchases are shown in detail and one of the items, a giraffe teether, has elicited a question/comment from a friend (highlighting ours):


In comparison, credit card transactions list only the merchant name and not what was purchased. However, Blippy allows users to annotate their transactions to add that detail, as you can see in the following entry. 


One of the most common ways Blippy is used is to stream media consumption via iTunes and Netflix. Here are the three Netflix movies on their way to @crobertsjr:


The Palo Alto-based startup received a $1.6 million angel round in January 2010 from Ron Conway, Jason Calacanis, Twitter's Evan Williams, Sequoia Capital, Charles River Ventures, and others. 

How it works
I got my first taste of Blippy after it opened to the public on Jan. 14. It's simple to get started, calling for just an email address, screenname and password. You also have the option of finding friends using your email address book or choosing from a list of 13 suggested people including Blippy founder Philip Kaplan (@PUD) and interstar Jason Calacanis (@jason).

But you don't even need to register for Blippy to see it in action. There's a live stream on the homepage that anyone can watch (see screenshot below). If Blippy follows the Twitter/Facebook model, they will soon have an API available that will let outside developers tap the data stream.

Usage stats

  • Number of beta users: More than 5,000 who streamed $4.5 million worth of transactions
  • Most-streamed merchant: Netflix with 54,000 entries
  • Most prolific spender (that I ran across): Foo Bar (@foo), who does not identify himself other than CEO at a gaming startup, has linked his business credit card and streamed more than 350 purchases worth more than $300,000 (he's a big online advertiser at Google, MySpace, Facebook).
  • Most-followed user: Leo Laporte (@leolaporte), from the Premiere Radio Network, with more than 2,600 followers


Data sharing within workgroups:

  • Ability to share financial transactions within a family, a workgroup, or small business. It would be a great way for financial gatekeepers, e.g., the bookkeeper, CFO, or even board members/investors to keep tabs on company spending (see @foo above).
  • Ability to annotate expense streams. Users can add short descriptions to expense items so their followers can see the specifics.
  • Ability to discuss/comment on expense items. For example, CFO can ask "why did our Google AdWords expense spike yesterday?" and anyone in the group can comment back with an answer or speculation. We use Yammer in our company for this type of back and forth. 

Product research/social networking:

  • Ability to find other customers of the same store
  • Ability to discuss product or media purchases with friends or strangers
  • Ability to post positive/negative info about purchases (yours or others)
  • Ability to find previous purchasers of a product you are considering (currently not supported through search)
  • Ability to compare how much people paid for a certain item (not currently supported through search)

Personal financial management:

  • Ability to annotate expenses for future reporting (e.g., marking taxable items)
  • Store transactions free for as long as Blippy keeps the servers running
  • Ability to search own transactions

Financial institution opportunities
1. Card companies and banks should create similar sharing functionality for alerts; especially for small business clients. While public posting of purchase data may never have mass appeal, there are many private uses for real-time transaction data.

2. PFM's should be building this functionality now to get out in front of Mint/Intuit who could simply acquire Blippy and incorporate real-time data flow within weeks. 

3. Once the Blippy API becomes available, banks should tap it to allow their customers to use it directly from within online banking.

Whether Blippy lives on as a standalone service is difficult to predict. It depends on whether these capabilities are incorporated into other social networks, particularly, Facebook (note 2) and Twitter. And how fast card issuers move to make real-time transaction info easily available to their own customers.

image But regardless of where the company nets out, Blippy should be credited with pioneering real-time financial transaction flow, something every financial institution and ecommerce company will support in the coming years. As a result, we are awarding Blippy an OBR Best of the Web award, our first of 2010 and just the third in the past 14 months (note 3, previous winners).   

Blippy Homepage (14 Jan. 2010 7 PM Pacific)


 Optional sign-in to Gmail, Yahoo or AOL to locate friends on Blippy 


Purchases/activity at these merchants can be automatically tracked
Note: 13 ecommerce merchants currently participate (Amazon, Apple iTunes, Audible, Blockbuster, GoDaddy, GroupOn, Netflix, SeamlessWeb, Stubhub, Threadless, Wine Library, Woot, Zappos)


The Blippy real-time transaction stream
Note: You can choose to watch all activity or just that of the people you are following


1. If she hadn't given Blippy her Amazon login info and linked only her credit card, there would be no product detail. It would just show as $80.95 spent at Amazon.
2. Blippy is similar to Facebook's ill-fated Beacon service launched in Nov. 2007. The service was quickly toned down, then eventually dismantled, due to the privacy brouhaha that ensued. Blippy is very different because its users are signing up specifically to share purchase info. 
3. OBR Best of the Web awards, from Online Banking Report, are given periodically to companies that pioneer new online and mobile banking features. It is not an endorsement of the company or product, just recognition for what we believe is an important development. Blippy is the 76th recipient since we began awarding it in 1997. There were just two winners in 2009.

Comments (2)

Syphr Launches Credit and Loan Info Site,

By Andrew Dolbeck on January 21, 2010 7:55 AM | Comments (3)


Syphr LLC is a technology and marketing CUSO (Credit Union Service Organization) that develops online tools to connect community banks and credit unions with prospective members. The company is owned by Eastern New York FCU and several other credit unions. Syphr's primary product is the RateMatch system, which allows banks and credit unions to position loan offers in front of consumers as they check their credit reports online (FinovateStartup 2009 demo here.)

Syphr's RateMatch system was designed to help credit unions find new members and loan customers. Syphr generates revenue by charging financial institutions when prospective clients click on a link to contact the institution. According to Syphr, the RateMatch engine has processed more than 5,000 reports, with an average loan payment savings of $239 per month.

Syphr's newest innovation is, a credit reporting website with targeted loan information. It's designed to help consumers save by comparing their current loans to those offered by Syphr's affiliated banks and credit unions. Instead of offering just the credit report, the company provides money-saving loan deals. The site launched January 14, 2010 (press release here).

Although the site emphasizes a free credit report, MoreThanACreditReport charges users $14.95/month after a seven-day free trial (see screenshot below; highlighting has been added).


As part of that membership fee, the site's customers get access to other Syphr products including monthly credit monitoring, a credit report every six months, and Syphr's Payment Patrol system, which allows customers to receive notifications of better loan options as interest rates change.

How Works:

1. Consumers register at the site to get their credit report.

2. The site uses the consumer's Zip code to display average loan rates for the local area.

3. Next, using the consumer's credit card information, the site pulls an Experion credit report using a soft pull that does not show as an inquiry on the borrower's credit file.

4. Syphr's RateMatch technology analyzes the user's existing loans and searches for better deals available from affiliated financial institutions in their local area. RateMatch is powered by DataTrac, one of the largest interest rate databases in the United States.

5. The site shows the comparison to the consumer, highlighting where they can save money by refinancing or switching loans. In the example below, Eastern New York FCU is identified as a place that could save the user $60 per month.


If there are no participating financial institutions in the consumer's local area, they are given a RateTrac report, which compares the consumer's loans against the average payment plans offered by loan providers in the area. If the report shows that the consumer is paying more than the local average, the consumer can use the data to help negotiate lower rates.


6. If there are participating lenders available, the website allows consumers to contact the lenders directly simply by clicking on the "exchange it" button. Lenders automatically receive the customer's contact details and credit info.

7. Clicking on an offer on the MoreThanACreditReport site does not constitute a firm offer of credit. The bank or credit union follows up to arrange the actual loan. Because the loan information presented by the website is based on the consumer's credit report, it is likely to be representative of what the participating bank will offer.

My take: Saving money on loans is one of the key reasons people check their credit reports. Syphr says that more than 175,000 people check their credit reports online each month. As a lead-generation system for financial institutions, has the advantage of putting loan offers in front of consumers at the precise time they are thinking about a new loan. 

The site



RateMatch Offers Loan Savings


Comments (3)

Home-Account Launches New Service at

By Andrew Dolbeck on January 15, 2010 10:16 AM | Comments


Online mortgage startup Home-Account has licensed the domain name and today launched a new, free service for people seeking to refinance their homes (press release).

The domain name was formerly that of Homebridge Mortgage Bankers Corporation, which had acquired the name for more than $700,000 in 2005. But in the 2008 mortgage meltdown, Homebridge went out of business and the valuable domain name went unused throughout 2009.

Home-Account is a 2009 Finovate alum (video here and here) specializing in helping consumers navigate the confusing mortgage marketplace. The startup uses an online system to assess a home loan applicant's suitability before they apply. It then provides advice and assistance in finding the best mortgage. The company contracts with mortgage lenders to provide firm price quotes at the end of the process. Lenders pay Home-Account a fixed fee for each mortgage.

The startup has enlisted noted mortgage finance expert Jack Guttenberg, also known as the Mortgage Professor (link) to endorse the service.

How it works:

1. To begin the process, simply enter a Zip code.


2. Complete a three-part online application detailing personal financial info (including social security number), info on existing mortgages, and a short "mortgage personality" quiz to help match buyer needs with mortgage options (e.g., fixed vs. variable rate).

3. Confirm identity using info from credit files.

4. Home-Account then pulls a credit report using a soft pull that does not show as an inquiry on the borrower's credit file.

5. The site provides a loan-eligibility score, a few quick tips on improving credit qualifications, and firm loan offers including rates and all fees from qualified lenders. The borrower reviews the various offers side-by-side, a feature that should provoke healthy competition among the lenders.

6. If the borrower decides to move forward, they click on their desired loan to lock in the offered rate.

7. The selected lender then closes the loan directly with the borrower.

At launch, several lenders are offering loans through the system including:, RoundPoint Mortgage Company, Eagle National Bank and First Choice Funding.

Analysis: The mortgage shopping and refinance process is still a mystery to a large percentage of consumers. It is difficult to compare prices while shopping, and the myriad of fees tacked on during the process can leave a bad taste with the borrower. Consumers rarely know if they truly received a fair deal when all is said and done. The Home-Account/ solution promises to add more transparency during the entire mortgage process. That's welcome news to scandal-weary American consumers.

However, convincing skeptical consumers to trust its mortgage-recommendation engine will be a major challenge for Home-Account. Third-party endorsements, and possible integration with financial institutions or personal finance tool providers, will be vitally important. #1 - The site grades loan eligibility ...

clip_image006 #2 - ... and suggest ways to improve it.



Cardlytics Launches Innovative Debit Card Incentives Program

By Andrew Dolbeck on January 13, 2010 1:39 PM | Comments (2)


Would you like your bank statement to be more interactive? Cardlytics is betting you would. The company's patent-pending technology allows merchants to present their customers with rewards and incentives for shopping with existing bankcards, without needing extra coupons or promotional codes.

But the clever part is that the incentives are placed directly in the customer's online bank statement. The consumer can activate an offer by clicking on it and then using their card at the merchant. No coupons necessary.

Here's how it works:

(1) Bank clients log into online banking. The bank statement includes special offers based on the client's previous spending. As shown below, offers are presented next to the transaction record:


(2) To get more information, users click the expand link.

(3) Accepting the offer activates the promotional deal.


(4) Once the promotion has been activated, the cardholder simply uses the associated debit or credit card at the merchant. The reward dollars are then automatically credited to the account at the end of the next month. Nothing needs to be printed or carried to the store.

(5) Qualifying transactions are instantly confirmed in the consumers' online banking statement.

Analysis: The Cardlytics system is a useful tool for banks seeking to develop incentive programs. According to Cardlytics CEO Scott Grimes, consumers in the current economy are no longer buying into the "pay for it later" mentality fostered by credit cards, making this the perfect time for banks to provide debit card incentives. Merchants fund the rewards in exchange for the highly targeted advertising.

The appeal for the merchants is obvious. They are able to make highly targeted offers directly to customers of their competitors. In the example above, McDonald's places its famous Golden Arches in front of a Burger King customer. That's a definite score.

As a result, more than 50 national retailers have signed up for the platform.

One cautionary note: Will Burger King customers feel they've been sold off to McDonalds by their banks? It's a real concern. Customer education will be important so that consumers understand that no personally identifiable information is being released to advertisers.

The ultimate test for Cardlytics will come from the consumer. Will the Cardlytics program increase bankcard use? It might if the deals are attractive enough to change behavior. So far, the company reports positive results, with an average response rate of 15% and some going as high as 40%.

I'll be watching my bank statement.

Comments (2)

Blippy: Do We Really Want to Automatically Tweet our Purchase Transactions?

By Jim Bruene on December 16, 2009 5:12 PM | Comments (3)

image I love startups. Just when you think you've seen everything, along comes someone doing something that no one would have ever thought of five years ago, or in this case one year ago.

image The latest inspiration: Blippy. The service allows you to automatically broadcast your credit or debit card purchases using the Twitter/Facebook model (see screenshot below; note 1).

The first question everyone asks is why? (see comments at TechCrunch) But really, it's not much different than broadcasting personal details via Twitter or your whereabouts via Foursquare, especially if you limit viewing to friends. The founder, serial entrepreneur, Philip Kaplan explains in the TechCrunch interview, that he has one credit card for "social purchases" broadcast on Blippy and another for purchases he prefers to keep private.

Blippy will contain privacy controls that allow users to share everything or keep it within a closed loop of friends. The company also envisions many other privacy controls to turn the service off and on, allow users to approve transactions before publishing, suppress certain merchants, or merchant categories, and so on.

The use cases shown so far are centered around media purchases, for example using it to automatically tweet (blip?) what song or movie you bought on iTunes or social "check ins" where the service lets people know you just bought coffee at Starbucks. But I can see where it would be helpful for spouses to "broadcast" purchases only to each other. Or for a salesperson to broadcast their purchases to their assistant to build expense reports on the fly. 

The service is in closed alpha (only in use by a handful of friends and family, note 2) as the three-person company gears up for a launch. You can follow Kaplan on Twitter (@pud) for more info.

My take: I like the idea of easily sharing purchases with joint-account holders or a bookkeeper. But many (most?) online banking systems and PFMs already allow this through the alerts system. You may want to boost education efforts on this capability.

imageAs for Tweeting about songs downloaded via iTunes, wouldn't most users prefer to maintain more control over that by simply using Twitter or Facebook to directly type a short note? But we know from experience, if there's a way to do something with less effort, it stands a good chance of succeeding.  

I'm not expecting widespread adoption any time soon, but I think there is a market for sharing spending transactions.

Here's something for innovative FIs to consider: Add a "share this" button next to credit/debit card transaction and let users send the info via email, Twitter or Facebook with a couple keystrokes (see inset from FiLife).

I know it sounds far-fetched, but it might be just the thing to make your card stand out with heavy users of social media.

Blippy homepage showing spending stream (16 Dec. 2009)


1. For more info in Twitter, see our Online Banking Report on the technology published in May.
2. Twitter's Evan Williams is using Blippy as shown in screenshot taken by CNET's Rafe Needleman in his article earlier this week.

Comments (3)

P2P Payments: CashEdge's POPmoney Spotted in the Wild at First Hawaiian Bank

By Jim Bruene on December 9, 2009 7:30 PM | Comments

clip_image002When CashEdge demo'd its new person-to-person (P2P) payment solution, POPmoney, at Finovate in September (video here), they said they expected four clients to be live by year-end. It looks like the first one is there, or almost there.

imageFirst Hawaiian Bank has a lengthy POPmoney FAQ posted on its website (see screenshot  below). Pertinent details on the new POPmoney service include (refer to full text below):

  • Cost is $1 per transaction
  • Users can send money via email address, mobile phone number, or directly into the recipient's bank account (if known)
  • Online banking customers will find it in the Transfers section under a tab entitled Send Money
  • P2P payments are limited to $5,000 per month subject to a daily maximum of $1,000 via email/mobile or $2,000 transferred directly to another bank account
  • Payments can be scheduled up to one year in advance

For more on the P2P payments market, see our latest Online Banking Report, published 15 minutes ago: Making the Case for Person-to-Person Payments

First Hawaiian Bank's POPmoney FAQ (link; 8 Dec. 2009)


FAQ text:

What is "POPmoney"?
"POPmoney" is a feature of the FHB Online® banking service that lets you send money to someone electronically via their email address, mobile phone number, or directly to their bank account. Payments to someone's email address or mobile phone number are accompanied with a personalized message letting them know that the funds are available for electronic deposit to wherever they choose, while payments to someone's bank account are deposited automatically.

How much does POPmoney cost?
Sending money via POPmoney costs only $1.00 per transaction.

How do I sign up for POPmoney?
POPmoney is available to customers through the FHB Online service and can be accessed via the "Send Money" tab within the "Transfers" section. If you are not currently enrolled for FHB Online, visit and click on the Online Banking "Enroll" button in the upper left-hand corner of the screen. If you are already enrolled for FHB Online, sign onto FHB Online, go to the Transfers section, and then click on the Send Money (Personal Only) link. Follow the three-step sign-up process:

  • Step 1 POPmoney Agreement - Accept the FHB Online POPmoney amendment.
  • Step 2 Contact Information - Your email address and mobile phone number are required as part of the sign-up process. You will need to verify the email address we have on file is correct. If it is incorrect, please close the window and click "Update Email Address" within the Customer Service tab to update your email address. After confirming your email address, return to the "Transfers - Send Money (Personal Only)" link and you will also be asked to provide a mobile phone number as part of the sign-up process.
  • Step 3 Email/Mobile Phone Validation - We will send verification codes to your email address and mobile phone. Please check your email and your mobile phone for these codes and enter them in the boxes shown on-screen to complete the sign-up process.

Once you've completed the steps above, you will receive a confirmation message indicating that you have successfully signed up for POPmoney. Click "Continue to POPmoney" to start using the service.

Who can I send money to?
You can send money to someone just by knowing their mobile phone number or email address. The person receiving the notification will be able to deposit the money to any personal checking, savings, money market checking, or money market savings account at FHB or nearly any other U.S. bank. You can also send money directly to someone else's bank account if you have their bank routing and account number information.

How does the recipient receive and deposit funds?
If you are sending money to a mobile phone or email address, the recipient will receive a notification with a personalized message indicating that you have sent them a payment. The recipient has two ways of depositing the funds:

  • If the recipient is a First Hawaiian Bank customer, they can deposit the funds into their account via the FHB Online service. Upon enrolling, or if the recipient is already enrolled for FHB Online, they can click on the "Send Money (Personal Only)" to access the POPmoney feature. Any payments that have been sent to them will be listed under the "Incoming Payments & Alerts" tab. They can then select an account to which to deposit the funds. They can also designate whether future payments should be automatically deposited to this account.
  • If the recipient is a not a First Hawaiian Bank customer, or would like to deposit the funds into a non-FHB account, they can visit They will be prompted to provide their mobile phone or email address along with their bank account information for the payment to be deposited.

Can I send money internationally?
No, you can only send money to individuals via their accounts within the U.S.

What is the maximum transaction amount I can make via POPmoney?
The maximum daily amount allowed for POPmoney transactions is the current available balance in the source account (plus any available credit in an associated Yes-CheckSM account if applicable) up to the daily limit mentioned below, whichever is less. This includes any single transaction or the total amount outstanding or "in process." For additional information, see below:

Sending Money to Bank Account

Maximum Amount





Sending Money to Mobile or Email

Maximum Amount





Can I set up recurring or future-dated transactions?
Yes, POPmoney transactions may be scheduled up to 365 days in advance of the date the transaction is to be made. Automatic recurring transactions may also be scheduled for substantially regular intervals (e.g., monthly) in the same amount between the same two accounts. You can schedule recurring transactions to be made weekly, every other week, twice a month, monthly, every four weeks, every other month, quarterly, twice a year, and annually.

How far in advance can I schedule a transaction?
You can schedule a POPmoney transaction up to one year in advance.

When are POPmoney transactions processed?
Transactions will be processed on the date you specify up to a year in advance. Transactions will take approximately three business days to process. Transactions scheduled to process on a weekend or holiday will be processed the previous Business Day.

What is the cut-off time to submit a transaction?
The cut-off time for submitting transactions is 7:00 p.m. HT each Business Day. Transactions submitted after 7:00 p.m. HT or on weekends or holidays will be processed the next Business Day. A Business Day is every calendar day except for Saturdays, Sundays, and bank holidays.

What is the cut-off time to change or delete upcoming transactions?
The cut-off time to change or delete an upcoming transaction is 7:00 p.m. Hawaii Standard Time the previous Business Day prior to the send date.

When does the transaction get debited from my account?
The transaction debit request is initiated on the "send date" but will not post against your account for one to two days.

What happens if I set up a transaction but do not have sufficient funds in my account on the "send date?"
If, on the "send date," there is insufficient balance in your account to make a transaction you authorized, we will delay the transaction and try again on the next Business Day. If there is still insufficient balance to make the transaction, we may either refuse to pay the item, or we may make the transaction and overdraw your account. In either event, you will be responsible for any non-sufficient funds ("NSF") or overdraft charges that may result.

How many people can I add to my list of contacts?
You may add up to a total of 50 contacts.

I used to send money to third parties via the External Transfers function. What will happen to this information?
As part of introducing POPmoney, we have migrated your third-party information and activity from External Transfers to POPmoney. This includes contacts or accounts, as well as upcoming and previous transactions. Categories for previous transactions will not be migrated and will need to be re-defined.

How do I disable POPmoney?
You may disable POPmoney by calling us at 643-4343 (1-888-643-4343 from the Continental U.S., Guam, and CNMI). Please note that disabling POPmoney will also disable your access to External Transfers.


Launched: PerkStreet Financial Focuses on Debit Card Rewards and Free Checking

By Jim Bruene on December 2, 2009 6:32 PM | Comments (7)

image With growing debit card usage, and few rewards programs with meaningful payment bonuses (note 1), the market seems right for a focused debit-card-rewards provider.

But the market has not evolved as fast as many thought. Capital One threw in the towel on its decoupled debit rewards program. Finovate alum (video hereTempo Payments is refocusing on affinity-branded cards, which often have a reward component paid for by the affinity partner.

But a new entrant, PerkStreet Financial (powered by The Bancorp Bank) may have the right answer: reward levels on par with credit-card programs, 1% of spending value, 4x the average debit card program (note 1). The company emphasizes rewards paid via free coffee (nice tie-in to the name), music downloads (going after the youth market), or gift cards from name-brand retailers (adds retail interest to the account). See the first screenshot.

But with lower interchange, and no monthly fee (note 2), how can a bank afford such high rewards?

  • No branches
  • Rewards paid out on retail stored-value cards which are provided to the bank by retailers at prices less than face value
  • $30 overdraft charges (but it's OPT-IN optional)

$50 new-account bonus: If you navigate directly to the website, there is no new account bonus (see screenshot 2). But if you use Google, it's hard to miss PerkStreet's ad (screenshot 3) or the affiliate deals. Going to the site through those options earns you a $50 bonus (screenshot 4), and in the case of the Google ad, an additional $50 qualified satisfaction guarantee (screenshot 5). 

1. PerkStreet perks page (link; 2 Dec 2009)


2. Standard homepage with no offer, emphasizing free


3. Google search for "PerkStreet Financial" (2 Dec 2009, 5:30 PM Pacific from Seattle IP address)


4. PerkStreet homepage accessed via affiliate (Doughroller link)
$50 bonus with $25 opening deposit and three months of activity


5. Landing page offer (link, 2 Dec 2009)
$50 bonus now with direct deposit, and $50 more if not satisfied within eight months.
To qualify as not satisfied, you must have set up direct deposit within 60 days of account opening, made 10 or more debit transactions per month for six straight months, and have closed your account within eight months of opening.


1. According to the fine print disclosures on PerkStreet's homepage, 17% of debit cards provide rewards with an average value of 0.23% of spending (source cited: BAI/Hitachi 2008 Study of Consumer Payment Preferences).
2. The account has a monthly fee ($4.50) only if there is no activity.

Comments (7)

Fast Company Recognizes Eight Financial Startups in its NextFinance Column

By Jim Bruene on September 17, 2009 5:55 PM | Comments (1)

imageReally, we weren't looking for ways to plug our Finovate conference. Usually we just come right out and tell you to register now since it's only 10 days away. But imagine our delight when we opened up the latest issue of Fast Company (Oct 2009) and Dan Macsai's article included six Finovate companies in his list of eight startups "brimming with hope for the financial industry" (see screenshot below; note 1).

In Dan's words, these companies are noteworthy as:

Web-based financial startups creating services that embrace transparency (even in their largely fee-based pricing) and improve the customer experience.

Congratulations to the eight winners (in order of their appearance in the article): 

  • Tempo Payments: Decoupled debit (FinovateStartup 2009 alum, video)
  • BancVue: Community bank rewards checking and Kasasa national brand (upcoming Finovate 2009 presenter; FinovateStartup 2008 alum and Best of Show winner, video)
  • MarketRiders: Impartial mutual fund advice for $9.95/mo
  • Mpower Ventures: Providing financial services to the world's unbanked.
  • SecondMarket: Helps companies auction securities and other illiquid assets (FinovateStartup 2009 alum, video)
  • BrightScope: Independent advice for 401k plan participants (upcoming Finovate 2009 presenter)
  • Jwaala: Personal financial management and online banking tools for small and mid-size financial institutions (Finovate 2007 charter presenter, video; FinovateStartup 2008 alum and Best of Show winner video; 2009 Finovate Startup alum, video)
  • The Receivables Exchange: Real-time auctions for accounts receivables (FinovateStartup 2009 alum, video)

Fast Company's NextFinance column (Oct 2009, pp. 76-78, ad page omitted)


1. We'll take a .750 batting average any time. But, we'll also try to recruit MarketRiders and Mpower to future Finovate events.

Comments (1)
Categories: BancVue, Finovate, Jwaala, Launches

PocketSmith and Cashflow Insite are Newest Online PFMs

By Jim Bruene on August 21, 2009 5:37 PM | Comments (1)

Last September, six online personal finance managers launched in a single month (previous post). Since then, just a handful of new PFMS have appeared online. Most newcomers have instead chosen the iPhone where more than 1,000 finance apps have launched in the past 12 months.

The iPhone is great for on-the-go transaction processing, but most PFM users will still do their heavy lifting at their computer, setting budgets, tracking expenses, planning for the future, preparing tax returns and so on. So the online venue is still the key competitive battleground. 

Two new online efforts have come to my attention in recent weeks. We'll look at them in more detail later this year (see note 1). 

  • image Cashflow INSITE, from Neuralus. The Winnipeg, Canada-based startup is looking to partner with banks and credit unions to deliver the PFM. The company is also targeting the financial advisor market where they have a number of independent advisors paying a flat fee (currently under $100/mo) to support up to 100 clients on the Cashflow INSITE platform. 
  • image PocketSmith, a New Zealand-based firm which launched its beta last year, uses the popular calendar approach to tracking personal cash flow and appears to be gaining some traction in the United States. It's monthly unique U.S. visitor total in July was more than 8,000 according to Compete (see chart below). That puts it at number 13 of the busiest online PFMs in the U.S. according to estimates from Compete (note 2). It's also the highest ranked newcomer to the chart and the non-US PFM with the most U.S. traffic.

PocketSmith monthly traffic estimates from Compete
Monthly unique visitors Aug. 2008 through July 2009


Cashflow INSITE homepage (21 Aug 2009)


PocketSmith homepage (21 Aug 2009)


1. We covered the personal financial management space several times in Online Banking Report, most recently: Personal Finance Features for Online Banking; Social Personal Finance; and Online Investing Communities.
2. See the current issue of Online Banking Report: 2010 Planning Guide, for the U.S. traffic estimates for 28 online PFMs.

Comments (1) offers timely personal finance tool to save on property taxes

By Jim Bruene on June 2, 2009 5:48 PM | Comments (1)

image Usually, it's the big ideas that get all the press. Last week alone, Microsoft launched a new search engine (Bing), Google announced a new way to communicate (Google Wave), and Facebook began rolling out an alt-payment service to its 200 million users. 

Those have intriguing long-term ramifications, but can they save you money today? 

Here's something a little more pragmatic: A tool that promises to make it easy to challenge your tax assessment, potentially saving hundreds or thousands of dollars annually. Enter (LMA).

I saw a few screenshots of the service during the company's application to debut at FinovateStartup 2009 last month (demo video here). But I couldn't use the service until a few weeks ago.

How it works
image Consumers visiting LMA can use the website's free tool to check their home's value against current market estimates. LMA taps public databases to determine tax-assessed values and calculates market value from various third-party sources such as Zillow.

The company then makes the simple math calculation and informs users if the value of their home is under the tax-assessed value. If it is, LMA provides forms and instructions to challenge tax assessments with the local assessor's office.

In our test case, using an address in Seattle, one of 10 states currently served by LMA, we were told that its assessed value was $300,000 more than the market value (note 2). LMA encouraged me to register and let them help me challenge that assessment.

Registered users complete an online form with info needed to challenge their assessment (see screenshot 3 below). After completing that form, users must pay $125 to complete the challenge process and receive their FairValue Report (shown above).  

While the cost-saving potential is significant, the challenge for LMA is getting consumers to shell out $125 for something they can conceivably do themselves (note 3). It took us just a few minutes using Google to uncover the challenge forms and procedures at the King County website. And market value estimates can be pulled from Zillow and its competitors.   

To reduce sticker shock, the company recently removed the big $125 price tag from its homepage (see screenshot 1) and is now emphasizing the free lookup feature (screenshot 2). I can understand downplaying a three-figure fee, especially online. But now they've gone too far the other way. I cannot find the price of the service anywhere on the website. It wasn't disclosed until I completed my registration and filled out the challenge form (see screenshot 4 below).

There's also the small matter of getting the word out. The major market opportunity will largely be gone once home prices get back to their pre-recession levels, even though there will always be cases where consumers feel their assessment is unfair. But LMA needs to team with major financial or real estate firms as soon as possible to reach large groups of potential customers. 

Bank and credit union opportunities
As discussed in previous posts, direct fee income is scarce in online banking, at least in the United States. Aside from credit bureau monitoring, there are few up-front fees that consumers are willing to pay. Certainly, banks earn billions from the underlying checking, debit, and credit card accounts, but nothing from the value added online.

It's possible the service could be replicated by a bank or mortgage provider using available APIs from Zillow or others. But for most banks, it would be far simpler to outsource the service to LMA or other specialists.

If the service were sold for $100+, with revenue shared 50/50, a bank or credit union could earn a respectable profit while providing a unique and free service to customers; however, the folks at City Hall may not be so appreciative. If city government is a big customer, you might tread carefully here.

1. New LowerMyAssessment homepage emphasizes free (2 June 2009)


2. Previous homepage disclosed the substantial fee up-front (12 May 2009)


3. Online appeal form for King County Washington (2 June 2009)


4. $125 (+tax) fee is not disclosed until checkout (2 June 2009)


1. States currently covered: Arizona, Florida, Hawaii, Illinois, Indiana, New Jersey, Ohio, Oregon, Washington
2. That was on May 11. Now, three weeks later, LMA shows the house having declined another 20%. Home prices are certainly fluctuating, but not that much. It appears that LMA has switched to using Zillow's low estimate instead of the mid-range one. That may help sell more services, but it's a bit misleading. It would be much better to show the range of potential market values pulling data from all three third-party valuation sites, in much the way RedFin does. 
3. They also have some work to do in clarifying the buying process. It's not really clear exactly what you are buying at checkout. Are you submitting a property-tax challenge at that point? What about the FairValue Report? When do you see that? But we'll cut them slack on that since they just launched a few weeks ago.

Comments (1)

Straight out of Twitter: BillMyParents Launches

By Jim Bruene on March 27, 2009 3:31 PM | Comments

image I've mostly just observed the Twitter phenomenon, following a few people and seeing how banks and credit unions are using it (see my previous post for financial institutions on Twitter). However, I'd not fully embraced Twitter either as a publishing device or research source. The 300 or so RSS feeds, emails and news items that cross my desk each day seemed like plenty of intelligence to sift through.

But now, I'm reconsidering my priorities after learning about an interesting new alt-payment company BillMyParents from Twitter activity (see notes 1, 2).

How it works: BillMyParents is a new service from IdeaEdge's Socialwise (press release). The service is primarily designed for kids to shop online. They select what they want, then at checkout, redirect the bill to their parents via an email alert to PC or mobile phone. Parents login and complete the payment process at their convenience using MasterCard, Visa, Discover Card (no American Express; see third screenshot below). Card info can be stored for one-click future approvals.

The company charges a $0.50 transaction fee for each purchase. But like PayPal, the real money will be made when the company pushes purchase transactions through the ACH system.  

Currently, BillMyParents is selling prepaid gift cards from its site as a proof-of-concept. I tested it yesterday and everything seemed to work as described (see second screenshot below).

The opportunity: The service reminds me of the unmet need that PayPal filled nine years ago. Purchasing at eBay was a major hassle due to the lack of online payment capabilities. Kids have similar problems when trying to buy things online.

The service could also be adapted to other situations where one party does the shopping but wants someone else to authorize payment such as small businesses, nannies, or even spouses. It could also be used for extra security when the shopping is done in a non-secure environment such as public terminal and payment is redirected to a more secure device, such as your mobile phone.

Like any alternative payment, BillMyParents requires the merchant to add the option to its ecommerce platform and consumers to set up accounts. Both of those are time-consuming and face the chicken-and-egg dilemma, i.e., it's hard to attract merchants without a substantial user base while its difficult to add users without merchants.

Bottom line: This is a winning idea. The massive discretionary purchasing power of teens and pre-teens is a tempting target in this difficult retail environment. And financial institutions, or their payment partners (e.g. Visa, MasterCard), looking to differentiate themselves with the youth market, could jumpstart the program. Or more likely, PayPal and/or Amazon will dive in, either acquiring BillMyParents outright, or building their own version(s).  

BillMyParents homepage after setting up an account (26 March 2009)
Note: Split login screen for kids (left) and parents (right)


Proof-of-concept: Gift card purchase (26 March 2009)


Parent's approval screen (26 March 2009)


1.  Thanks to Frederic Baud (@fredericbaud) who was the first in my network to Tweet about BillMyParents; and to Glenbrook's Scott Loftesness (@sjl) who's retweet is actually what caught my eye.

2. BillMyParents appears to have grabbed its Twitter page name (@billmyparents), but it's not yet active.


Finovate Startup Conference Company Descriptions

By Jim Bruene on February 26, 2009 11:42 AM | Comments

image To give you an idea of the types of innovations being funded in financial services these days, here's a capsule description of the first 48 companies demoing at FinovateStartup April 28 in San Francisco (note 1).

Attention attendees: You have just one day left to register (here) at the discounted price of $795. 

Finovate Startup 2009 Participants

Acculynk is a payments solutions provider with a suite of software-only services that secure online transactions by utilizing a graphical, scrambling PIN-pad for the secure entry of sensitive cardholder information.

AlphaClone is a web-based investment research service that lets users explore the investing ideas of top hedge fund and institutional money managers.

Aradiom is a mobile solutions provider and designer of Java mobile applications and platform development technology including turn-key applications, embedded soft-token security solutions and BlackBerry® enterprise applications.

BillShrink is a personalized savings advisor that helps consumers make smart, money-saving decisions by providing continuously updated, personalized, usage-based recommendations on everyday services like credit cards and cell phone plans

BudgetTracker is a personal finance manager that allows users to manage their finances and keep track of their budget, bills, and transactions online without having to install software.

CalendarBudget is a free online personal budgeting tool that helps users organize and track their finances, plan future spending and save money.

Centrro is a financial search engine that allows consumers to anonymously shop for personal financial products that best fit their specific credit profile.

CircleUp provides group communications services, which enable actionable and efficient interactions across diverse social, email, mobile, messaging and private web networks.

Cooler Inc.
Cooler Inc. enables users to know, decrease, and offset the global warming impact of their everyday purchases and activities by using the country's only peer-reviewed carbon calculator to calculate impact and then providing reductions targets and strategies, and offering recommendations on high quality carbon offsets.

CreditArray is a vault of proprietary information to allow consumers to better apply for and manage their credit portfolios.

Credit Karma
Credit Karma provides consumers free access to their credit score and offers credit simulators, advice, and credit score comparison tools in order to allow them to more actively manage their credit and financial health.

GoalSpring's product, DebtGoal, makes paying down debt as easy and efficient as possible by taking into account all of a customer's debt and helping them organize, optimize and pay it down.

Expensify simplifies keeping track of business expenses by combining an electronic payment card and a web-based expense manager to automate expense report preparation, approval, and reimbursement.

Green Sherpa
Green Sherpa offers personal cash flow management software that lets users conveniently download, manage and update all their financial accounts via a single online resource.

Home-Account is in stealth mode at this time. 

HomeATM provides a secure PIN debit and PIN credit card transactions method via the Internet that utilizes the HomeATM swipe pad technology to allow users to conduct secure PIN-based transactions from home, ensuring virtually zero fraud and lower merchant processing fee costs.

iBearSoft is the creator of iBearMoney, a personal finance application for the iPhone that allows users to input and categorize their transactions, run financial reports, analyze payments, and keep track of expenses.

iThryv is a financial literacy platform that combines a content delivery system and an incentive system in order to create an immersive learning environment which provides a powerful tool when used in partnership with online banking and core providers.

Jwaala provides software for banks and credit unions that improves their online banking services. Their MoneyTracker application offers a personal financial management solution that can be added to any bank or credit union's existing online banking solution.

kaChing is a social investment community that applies an open source and social-networking strategy to offer every investor the opportunity to find outstanding investors, emulate their portfolios, and access the returns, insights, transparency and talent previously only available to wealthy individuals.

Kapitall is a rich web application that aims to make investing easy for everyone. Inspired by game design, Kapitall combines an graphical user interface with tools that make it easier than ever to research companies, build portfolios, share ideas and get smarter about the market.

Lending Club
Lending Club is an online social lending network where people can borrow and invest money at attractive rates.

LendingKarma is a person-to-person lending site that makes it easy for parties that know each other to create loans and provides borrowers and lenders with tools to help service the loan and see it through to repayment. enables people to manage their finances online using an open source financial platform that allows developers to build sophisticated applications which will help users enhance their experience and increase the efficiency of the service.

Mint is an online personal finance service that securely downloads users' financial transactions, allows them to categorize their transactions, provides a unified view of all account activity and relevant account alerts, and offers personalized suggestions for significant savings opportunities.

Moneta provides a secure, quick and easy form of online payment that directly debits users' checking or money market account allowing users to only enter a secure username and password when making online purchases.

NCore provides enterprise class delivery channel solutions to financial institutions within the Asia Pacific and Middle East regions fusing applications, innovative security and middleware technology into a single integrated platform.

OurCashFlow offers personal finance management tools for financial institutions that can turn their website into a place where customers can create a budget, save money and achieve their savings goals.

Pennyminder helps individuals and small groups manage their shared and personal finances by tracking deposits and withdrawals allowing them to see what's happening with their money

People Capital
People Capital is a peer-to-peer private student loan service that utilizes a unique scoring system to predict a student's potential and provide a true, unbiased measure of the economic value of an education that empowers students to make better educational decisions and offers multiple advantages for both borrowers and lenders.

Pertuity Direct
Pertuity Direct offers social lending for personal loans by bringing together the advantages of capital markets, social networks and traditional banking.

Portfolio Monkey
Portfolio Monkey provides free online portfolio management tools to help average investors optimize their portfolios and find customized investment ideas so they can create more efficient portfolios with higher expected return and less risk.

Prosper is a person-to-person lending marketplace where people list and bid on loans using Prosper's online auction platform.

The Receivables Exchange
The Receivables Exchange is a real-time online market for trading accounts receivable that gives businesses access to working capital at a competitive cost by connecting a global network of accredited investors to the nation's small and mid-sized businesses.

Rudder is a free personal finance software designed to minimize the effort required in managing money by helping users to manage their budget, track their bills and analyze their expected income and projected expenses.

Silver Tail Systems
Silver Tail Systems provides fraud prevention to defend users' websites against business logic abuse through the use of behavior detection, efficient investigation and real-time mitigation to track suspicious behavior and divert the bad actors, leaving legitimate users unaffected.

SimpliFi provides independent financial advice online. Users can complete a profile and receive a personal financial plan with specific actionable steps.

SmartHippo uses the power of the community to find users the best rates on financial products and services.

SmartyPig is a social saving service that helps users save for a specific goal by allowing them to invite others to contribute to their account, providing incentive boosts from top retailers, and offering a competitive interest rate.

moneyStrands is a money management service that helps users get information on anything from practical savings tips to getting help tracking expenses down

Syphr is a technology and marketing credit union service organization that created RateMatch, a service that matches participating credit unions with the thousands of credit report purchasers per month.

ThreatMetrix helps companies control online fraud and abuse in real time by profiling the device used in an online transaction so companies can determine whether the users are fraudsters or customers.

Transparent Financial Services
Transparent Financial Services is online comparison-shopping service for small businesses that uses technology to help users compare and purchase financial services like payroll processing, credit card processing and business loans.

Victrio offers a credit risk management system that uses voiceprint recognition technology to fight credit card fraud and identity theft.

Wesabe is an online personal finance management tool that provides members with information about where they spend and links them with a community dedicated to helping each other make smart financial decisions.

WeSeed seeks to demystify the stock market by helping real people share what they know and make smart investing decisions based on the collective wisdom of the community.   

ZimpleMoney is a web-based financial services platform enabling people and organizations to manage and administer financial agreements including loans, leases, rentals, tithing, trusts and settlements.


1. Several other participants are remaining anonymous for the time being. 


Pertuity Direct Launches Financial Mashup: Consumer Loans + Mutual Funds + Social Finance

By Jim Bruene on February 15, 2009 12:43 PM | Comments (1)

clip_image002Last month I wrote about Pertuity Direct's impending launch. It's been live for a few weeks, and I've had a chance to review it in detail. The model is so unique, we created an entire special report on the company. It is available to our Online Banking Report All-Access subscribers here. Others can purchase for $195 here. And if you just want the executive summary, read on.

Pertuity Direct is an amalgamation of two financial services plus a social lending community:

  • Mutual fund: Retail investment assets are gathered via the National Retail Fund, an interval mutual fund created by Gemini Fund Services. The fund plans to invest primarily in consumer loans originated by Pertuity Direct (see note 1). At the outset, there are two mutual funds to choose from: one will invest only in loans to prime customers with credit scores of 720 or higher; the other will take on more risk and invest in loans to borrowers with 660 or higher scores. Minimum investment is $250 and current estimated fund expenses are 3.1%.
  • Consumer loans: Three-year installment loans of $1,000 to $25,000 will be originated by Pertuity Direct under state licensure. The loans will be sold to The National Retail Fund who will hold them until they pay off. Pertuity Direct will be paid a 1% servicing fee from the fund. Borrowers also pay a 1% to 2% loan fee at funding. The company is currently licensed in 37 states.
  • Social lending: The last, and least, piece of the product is a social lending forum, where mutual fund investors can purchase Pertuity Bucks to give to already-funded borrowers to help them repay their loans.

Whether this should be called "peer-to-peer lending" is open for debate. Pertuity Direct makes all the loan decisions and sets the rates. Investors have no direct influence over which borrowers are funded. However, there is a social element because investors can donate to borrowers through the community area. The model probably most resembles a member-owned credit union or mutual savings bank.

From an investor's standpoint, it's a unique opportunity to capture banking interest margin without actually buying shares in a commercial bank. The mutual fund is more like a bond, so it should be less volatile than owning equity. Although current estimated management fees of just over 3% are a drag on earnings, the company hopes the percentage falls as the funds gain assets.

However, the mutual fund doesn't have the liquidity or upside of an equity investment. It's an interval fund, meaning they will allow some redemptions each quarter (note 2), but it's not publicly traded. There's also the matter of how they value the underlying assets of the fund. A proprietary model will value the consumer loan portfolio each day, but since the assets are not publicly traded, there is no way to really understand if that model is working until there is a performance history. 

Pertuity Direct does a credible job weaving these three disparate businesses together and its management team, with experience at PNC Bank and E*Trade, have great ideas on taking this business to the next level. But much remains to be done to educate the market and overcome the hesitancy of jittery investors. We will be following them closely (note 3). 

Screenshot: Pertuity Direct homepage (2 Feb. 2009)
The company posted a 3.5-minute YouTube video of founder Kim Muhota explaining the company's offering.


1. While the intention is to invest in Pertuity Direct-initated loans, the funds can also invest in other vehicles.
2. The prospectus says that it will allow 5% to 25% of its funds to be redeemed each quarter.
3. CEO/founder Kim Muhota will be participating in our FinovateStartup 2009, so you'll be able to hear directly from him.
4. For more info on P2P lending, see our Online Banking Report on P2P Lending.

Comments (1)

UK's MoBank Could be the First of a New Wave of Banking & Payments Companies Optimized for Mobile Delivery

By Jim Bruene on February 6, 2009 12:47 PM | Comments

imageMoBank, the U.K.-based mobile banking and payments said to be launching this month, is creating some buzz on the other side of the Atlantic (stories here, here, and here).  Given the pedigree of its two founders, Steve Townsend and Dominic Keen, who blazed many online banking trails at Egg and First Direct, it should provide a glimpse of the future of mobile finance.

The company is establishing a call center on the Isle of Man, run by Steph Gregg, a veteran of Egg, First Direct and Vodafone. Melanie Hunter is head of marketing, and David Rubin is head of mcommerce.

The company was named to Red Herring's top-100 global start-up list last month (here) along with FinovateStartup alum ClairMail (demo video here).

It appears at launch the service will support bill payment and certain mcommerce activities, such as purchasing movie tickets. An iPhone app is expected at launch. Users will register their credit/debit card(s) with the service. The company plans to expand into mobile banking and money-management activities in the future. 

The company has raised more than $1 million according to news reports. The company was founded in 2006 and presented at The Essential Web conference in June 2007
(p. 43, here) and had four employees at that time.

Here's how the company described itself 18 months ago:

MoBank is creating the world's first mobile-led online bank. The company believes that, for some sections of the population, small screen devices will become the channel of choice for most banking and payment services. moBank's business model is based on providing a free-to-use basic banking service with paid-for add-on features. Furthermore, moBank's users are enabled to participate in a range of unique, value-generating m-retail activities.

What's innovative: It sounds like a mobile-based account aggregation and bill-pay service, similar to Mint on the iPhone. But it could also contract directly with one or more banks like SmartyPig has (previous coverage). But as ING Direct proved, optimizing on a new delivery channel can pay off with great word of mouth and positive press.

MoBank pre-launch homepage (6 Feb. 2009)


Note: For more info on the growing market, see our Online Banking Report on Mobile Banking.


FinovateStartup 2009 Conference Participants Announced

By Jim Bruene on February 2, 2009 6:36 PM | Comments (2)

imageFinovateStartup09, our annual springtime technology event in the San Francisco Bay area, is just three months away. Today, we announced the first wave of young companies committed to participate on April 28.

More companies are in the pipeline, and when all is said and done we expect more than 50 startups to be on hand to demonstrate the latest in online and mobile financial services and technology.

The Finovate format combines fast-paced demos (no PowerPoint!) with extensive networking where you can meet the start-up founders along with influential industry executives, press corps, and analysts. To get a taste for the event, take a look at videos of past demos.

Because we hadn't named any companies until today, we've extended the Super Early Bird registration deadline until this Friday, Feb. 6 (register here). See you in San Francisco.

Finovate Startup 2009 lineup (as of 2 Feb. 2009):

Comments (2)

35 Financial Tech Companies Already on Board to Participate in FinovateStartup 2009

By Jim Bruene on January 22, 2009 6:52 PM | Comments (1)

imageOne month ago we announced the 2009 version of our Finovate Startup Conference. Since then, we've been busy talking to FinTech startups from around the world. We are glad (and a bit relieved) to announce that we already have 35 committed to demo at the event. There is still an enormous amount of activity and energy in the banking and financial technology sector (note 1).

We are several months out from the deadline, so we expect in excess of 50 startups, along with several hundred bankers, investors and other industry execs to convene April 28 at the UCSF Mission Bay Conference Center (note 2).

While last year's FinovateStartup was dominated by social-media plays (see logos below), this year we have more diversity, with companies from the following categories:

  • Alt payments
  • Financial shopping/comparison tools
  • Investment management/tools
  • Mobile banking & payments
  • iPhone/Android applications, personal financial management/tools
  • Peer-to-peer lending
  • Personal credit management tools
  • Other technologies

Participating companies will be named beginning Feb. 1, but you can save by reserving a ticket now.

Super-early-bird prices that are easy on the budget
We've tried to make the conference as affordable as possible recognizing that travel and conference budgets are under constraints. You still have nine days left to snag super-early-bird tickets for $695. Current Online Banking Report subscribers, including anyone in the same company as an existing subscriber, can grab tickets for even less, just $445 each until Jan. 31 (note 3).

Attendees may register here. More information on the event is here.

FinTech companies interested in participating/demoing should email Eric Mattson .

FinovateStartup 2008 presenters
(videos of all 2008 demos are here)


1. See our post, "Why financial technology still matters," here.
2. The venue is about two miles south of the San Francisco financial district.
3. If you don't know if your company subscribes to Online Banking Report, email to find out. If qualified, we'll email your subscriber discount code to you.

Comments (1)
Categories: Conferences, Finovate, Launches

ZimpleMoney Launches Peer-to-Peer Loan Platform to Power Social Finance

By Jim Bruene on December 9, 2008 7:24 PM | Comments

image Start-up activity in the financial technology sector has slowed dramatically since Sept./October when a dozen online finance startups launched (see previous post), not a surprising development given economic conditions and the time of year. 

Still, a number of companies remain in the pipeline, and yesterday we saw the launch of an entrant into the battered P2P lending space. But ZimpleMoney is not entering into the newly SEC-regulated market occupied by Prosper, Lending Club, Loanio and other hopefuls. Instead, the Costa Mesa, CA-based startup is offering a platform with tools so that third parties can either build lending services on top of it, or use ZimpleMoney's processing capabilities to manage loans and financial transactions.

ZimpleMoney can also be used like Virgin Money USA or LoanBack to handle a single loan amongst friends and family, either for personal or business use. The introductory price for an individual loan is $39 plus $7.99/mo.  

The site, which opened Monday, still looks more like a beta operation. The registration system wasn't fully functional yesterday, and I ran into several broken links today. But minor annoyances aside, it's an interesting development that should help drive social finance forward.

Given Prosper's recent woes, we are not likely to see new Prosper-like P2P exchanges using the ZimpleMoney platform any time soon. But it could be a good way for nonprofits, foundations, or microfinance organizations to launch Web-based loan operations with a minimal amount of development time and expense. Banks, credit unions, and other financial services companies could also private-label the service for their clients.

In his announcement email Monday, CEO (aka ZEO) Steven Rabago said they'd had interest from several nonprofits, a realty company, an investment management company, a student lender, and a large regional bank. Rabago started his career as a commercial banker at Bank of America. He left in 1983 to start National Corporate Finance (now called Archarios). In 2001, he co-founded a location-based services company Telogis, where he remains as a board member.

ZimpleMoney homepage (9 Dec 2008)


Note: For more info on the market, see our Online Banking Report on P2P Lending.


Receivables Exchange Launching Auction Platform for Financing Accounts Receivables

By Jim Bruene on November 11, 2008 8:01 PM | Comments (1)

image A new financial market will open Monday where businesses as small as $1.5 million in annual sales can borrow against their receivables with prices set in an auction market.

New Orleans-based The Receivables Exchange opens for trades on Monday (17 Nov) after an 18-month development cycle.

Businesses register with the exchange, a process that entails uploading financial statements and completing an application. The Receivables Exchange conducts due diligence on the potential participant to ensure that it is legitimate.

Businesses must meet the following criteria:

  • Minimum of $1.5 million in annual sales
  • At least 2 years of operating history
  • Registered to do business in the United States

Upon approval, the business can list specific invoices for financing, with a minimum total value of $10,000. Then accredited investors (SEC definition here) bid to provide short-term financing until the receivables are collected. Sellers are encouraged to upload PDF copies of invoices, proof of delivery, and so on to get the best rates. However, many documentation requirements are optional.

Sellers select the terms they are willing to accept and the bidder that beats those terms by the widest margin wins the credit. If no bidder meets the minimum terms, the auction ends without a trade.

Co-founders: Justin A. Brownhill and Nicolas R. Perkin

VC backers: Prism VentureWorks LLC and Fidelity Ventures

In an era of tight credit, it's a welcome addition to the financing tools available for small and mid-sized businesses. Larger businesses typically have more options through commercial paper and other capital markets.

The startup expects banks to be valuable sources of referrals. Although, at this point, there are no referral fees or revenue-sharing options.

So far, The Receivables Exchange has signed up sellers with a total of $2 billion in annual sales. And there's been a lot of interest. Founder Nicolas Perkin says his company has been approached by 20 $1+ billion companies.

But what about the other side of the trade, the lender/investor? The company says it has access to $8 billion deployable capital. Of course, that doesn't mean that the capital will be easily enticed into actual deals.

Starting Monday, we'll see what the buy side thinks. Are they willing to risk their capital in the unproven market? If The Receivables Exchange can drive out fraud and deliver on its promises, we think the answer will be yes.

The Receivables Exchange homepage (11 Nov 2008)


Comments (1)

Privier Launches ATMsend, a Promising Idea that Needs Banking Partners

By Jim Bruene on November 7, 2008 4:27 PM | Comments (9)

image I've communicated with Privier founder Charles Polanco a number of times over the years. He's a Wachovia alum who's been working on a financial startup for several years. The company launched a suite of payment services on Oct. 16 that aims to get the plastic card out of the ATM business (press release).

Privier's value prop is straightforward and compelling: Enable money transfers from any device at any time with the cash delivered through the worldwide ATM network.

The system initiates transfers in three ways:

  • ATMsend: ATM to ATM
  • iTransfer: Web to ATM 
  • mPayment: Mobile phone to ATM

In Privier's model the ATM card is replaced by a one-time authorization code that recipients key into the ATM to withdraw transferred funds.

From a usability perspective, it's a great idea. After all, what's not to like? Consumers need to send cash. ATMs have cash. Why not let folks authorize a remote ATM withdrawal from the comfort of their own home or office. A proposed fee in the $7 range beats most alternatives for long-distance money transfers.

However, from a practical standpoint there are two massive roadblocks to overcome:

  • Retrofitting ATMs to accept a keyed-in code instead of a mag stripe for authentication
  • Convincing banks to add ATM-transfer capabilities to Web, mobile and telephone services

It will likely take an organization the size of Visa, MasterCard, or Bank of America to pull this off. To ensure that those behemoths work with it, Privier has a portfolio of patents pending on the business process. 

What it means for Netbankers
It may take decades, but eventually, the Web married to mobile will eliminate the plastic debit/credit card; however, unless you are a major bank or payments company, this isn't likely anything you need worry about for a number of years.

A better short-term solution for smaller financial institutions is to enable P2P funds transfers using PayPal so you can send money to anyone with a PayPal account (see note 1).

Privier's Web-based interface for sending cash to an ATM (5 Nov 2008)SendCash_Step1

1. See our latest, the Online Banking Report 2009 Planning Guide, for more info on project priorities for this year and beyond. 

Comments (9)

Centrro Launches

By Jim Bruene on October 7, 2008 8:24 PM | Comments

image Providing free credit scores in exchange for viewing a credit card offer seems like a reasonable value exchange (see note 1). That's why we gave Credit Karma our OBR Best of the Web award in August and why it is on stage next week at Finovate (see previous coverage here, video at Finovate Startup here). 

It's also no surprise that others would try the same model. Credit crisis or not, credit-worthy borrowers are still a valuable commodity. Case in point, Bankaholic's recent acquisition by BankRate for a reported $15 million, or $50 per unique visitor (Mashable post here).

imageThe latest entry in free-credit-score lead generation is KnowBeforeYouApply (KBYA) from Centrro, a financial-search company founded in 2006 by Ike Eze and Tuyen Vo. Eze was a founder of QSpace, an OBR Best of the Web winner in 1997 when it became the first company to make credit reports available online (archived OBR article here). QSpace was acquired by Experian several years later.

KnowBeforeYouApply launched on Sept. 3, but was put on the map with Mr. Eze's post today in The Huffington Post entitled, "Stay Away from Me, Credit Card Crisis" (see note 2). The article discusses the value of tracking your credit score and using that knowledge to find the best credit offers. Eze mentions his company along with Credit Karma, Quizzle from Quicken Loans, two other Finovate presenters, Mint and BillShrink.

It would be difficult to make the site any easier to use. Customers type in their name, address, email address, and last four digits of their social security number. Apparently, that's all that's needed to access your credit file and return a letter grade of A through F.

The whole process takes about 30 seconds (there is no need to enter an entire social security number), and KBYA steers clear of those pesky out-of-wallet authentication questions. Users can get an update of their credit grade every 90 days. In comparison, Credit Karma, which provides an exact 3-digit credit score, will update it daily if the user so desires.

KBYA also has a simple and intuitive sales platform. Just two offers were highlighted in the main screen, one from Chase and one from American Express (see first screenshot below). However, clicking through to "see all offers" led to 25 pages of credit cards, displayed five to a page (121 total for A-grade credit). A handy index along the sidebar allows users to find various categories that most appeal to them such as "travel rewards" or "0% intro rate" cards (see second screenshot).

KBYA appears to use the API from to build a portion of its database of card offers. offers its affiliates up to $20 per application or up to $160 per approved application. KBYA also appears to be an affiliate of and Discover Card (see note 3).

The site is focused solely on credit cards for now. But a Home Loan tab is built into the user interface, with a "coming soon" label.

All in all, it's a good service. The site needs to beef up its FAQs, About Us, and other educational materials so users can better understand who is behind the service and what exactly the credit grade means. But as a month-old beta service, it's presumably coming.

While I prefer the precision and peace of mind of seeing my actual credit score, a letter grade every 90 days will be sufficient for many users and should help keep costs down. And the speed of the application process and lack of social security number are real benefits.

Financial institution opportunities
Banks, credit unions, and card issuers should consider offering similar functionality both inside online banking, where private info would already be known, and on the outside where prospective loan customers could use it. With info about the customer's credit grade, lenders could deliver tailored offers that could lead to increased application volume and approval rates. See our recent Online Banking Report for more info on lead generation sites (note 1). 

Know Before You Apply main page after login (7 Oct 2008)

Know Before You Apply homepage (7 Oct 2008)

KnowBeforeYouApply all-offers page (7 Oct 2008)

Know Before You Apply all offers page (7 Oct 2008)

1. For a thorough discussion of the topic, see our August 2008 Online Banking Report on New Models for Lead Generation.

2. Strangely, the article doesn't specifically disclose Mr. Eze's affiliation with Know Before You Apply, although clicking on his name does show he's CEO of Centrro. However, it's left to the reader to discover on their own that Centrro is the parent of Know Before You Apply. Hopefully, that oversight will be corrected.

3. The affiliate relationships are inferred from the redirects that take place when clicking on the Apply Now arrow.

4. This is one of the ten online finance companies that launched in Sept. (post here).


Loanio Launches New Person-to-Person Lending Service

By Jim Bruene on October 1, 2008 12:57 PM | Comments (3)

image Add one more company to the list of recent launches: Loanio went live today after a lengthy "coming soon" process (previous coverage here). The thousands of people on its email list received a message this morning announcing the launch (see below). 

Founder Michael Solomon demo'd the product back in April at our Finovate Startup event (video here). Today's live version looks similar to the April build. The key differentiating features of Loanio's product are:

  • Ability for anyone to borrow, if they have a creditworthy co-borrower
  • Optional enhanced pre-verification process (costs $35 for single borrower, $45 for co-borrower apps) allows borrows to boost their credibility by submitting the following documentation in advance of posting their listing:
    - Photo ID
    - Income documentation
    - Bank account statement
    - Employment documentation
    - Postal address documentation
  • Longer loan terms -- up to 5 years compared to P2P lending standard of 36 months
  • Borrowers have the option of accepting partial funding of their loan request as long as it's at least 35% funded

Several other tidbits from the FAQs:

  • Experian provides the credit info on borrowers
  • Lenders pay a 1% service fee on all outstanding loans
  • Buyers pay an origination fee as follows, equal to the greater of $95 or:
    -- Loans with one borrower: 2% for A and B credit grades, 3% for all others
    -- Loans with co-borrower: 3% for A, B and 4% for all others
  • Borrowers may seek loans of $1,000 to $25,000
  • Lenders must put in at least $100 to participate with a minimum bid amount of $50

The first borrower listing appeared on the site within the last hour or so, a C-grade credit seeking $2800 for debt consolidation (see screenshot below, note 1).

Screenshot of Loanio home page with first loan listing (1 Oct 2008)

Loanio homepage on launch day (1 Oct 2008)

State coverage limited
At launch, Loanio has gathered licenses to lend in only 22 states (see note 2). However, 10 of those have interest rate caps of 12% or less, so lending will be limited to the highly credit worthy, and one (Minnesota) caps the loan amount at $2550.  Here are the 12 states which Loanio primarily competes in today:

State         Max Interest Rate
Alabama 30%
Georgia 30%
Mississippi     30%
New Mexico      30%
North Carolina 30%
Indiana 21%
West Virginia 18%
Wisconsin 18%
Alaska 16%
Nebraska           16%
New Jersey 16%
New York 16%

These are the 10 states that allow borrowing from Loanio but cap the rate so that only those with excellent credit are likely to receive funding:

State Max Interest Rate
Tennessee 12.25%
Hawaii 12%
Louisiana 12%
South Carolina 12%
Virginia 12%
Connecticut 12%
Arkansas 11.25%
Delaware 11.25%
Kentucky 10.25%
Pennsylvania 6%
Washington D.C. 6%

As you can see, there is no lending in major population centers of California, Texas, Florida, Illinois, Ohio, Massachusetts and for the most part in Pennsylvania with a 6% rate cap. But there are ways to change that and Loanio can at least get started in 10 states while it fine tunes its business and develops methods for lending in all 50 states. Prosper and Lending Club both originate loans nationally through Webbank before passing them to the individual lenders. This allows nearly full geographic coverage, while usually bypassing state-mandated maximum loan rates.

Loanio joins Prosper, Lending Club, GlobeFunder, Fynanz, GreenNote and Virgin Money in the U.S. P2P lending space (currently, only Prosper, Fynanz, and now Loanio, operate true P2P exchanges). The others are either closed to individual lenders temporarily (Lending Club, GlobeFunder) or require borrowers to find their own funds from friends and family (GreenNote, Virgin Money). For a complete look at the market, see our Online Banking Report on Person-to-Person Lending.

Email: Loanio now open (received 10:39 AM Pacific time 1 Oct 2008)

Loanio email to house list announcing launch (1 Oct 2008)

1. Unfortunately, this loan is unlikely to be funded due to the max interest rate of 6%, likely because she is a Pennsylvania or Washington DC resident where the rates are capped at 6% (see table).
2. Just about anyone 18 or older can be a lender regardless of where they live. Only South Dakota and Pennsylvania residents are currently ineligible to lend through Loanio.

Comments (3)

Pennyminder is Tenth Online Finance Startup to Launch/Unveil in September

By Jim Bruene on September 24, 2008 6:00 PM | Comments (2)

image What a month for financial tech startups! Partly due to DEMOfall, TechCrunch50 and our Finovate, there's been at least 10 online financial service launches or unveilings this month in North America alone (note 1).

That could be the sign of a bubble about to burst, or it could just be a bunch of smart people meeting very real market needs. Only time will tell. 

Lucky number 10 is Pennyminder, an online personal finance startup based in Vancouver, BC. I met founder Vince Hodges at BarCampBankBC last Saturday (coverage here). Although Pennyminder joins a crowded field, the seventh personal finance manager (list below) to launch this month, it's the first ever based out of Canada. That alone should help it gain some traction.

Vince proffered a beta invite, so I've had a chance to look at it. It's a nice, clean design that allows user entries/statement import and supports an expense sharing/social angle. I don't know if that's enough to compete with the dozens of U.S. and international personal finance sites, many with VCs funding a wider range of features, but it's a good start.

Pennyminder will have to figure out a way to break through the clutter, such as partnering with credit unions and/or banks.

Here are six more newcomers this month:

1. Includes the seven mentioned here plus three more I've yet to blog about.

Comments (2)

New Online Personal Finance Manager Thrive Rounds Out Finovate NYC Conference Lineup

By Jim Bruene on September 23, 2008 4:43 PM | Comments

image With three weeks remaining before Finovate NYC, the final company in the demo lineup is stepping out of stealth mode and announcing its participation in our second annual new-products conference. See the full list here.

image Thrive will be launching its entry in the online personal finance marketplace,, at Finovate on Oct. 14. The company hopes to differentiate itself with more advanced financial planning tools while still remaining free. Founder and CEO is Avi Karnani; Marc Matsumoto is CMO.  

Currently, the service is in closed beta testing, but Thrive recently updated its homepage with a timely message playing off last week's financial debacle (screenshot below). 

We had a chance to meet with the NYC-based founders earlier this year and were impressed how they'd studied the current players and were aiming to leapfrog the competition. However, there's been significant innovation in the space this year, and they enter a crowded field (more on that tomorrow).

At this point, I can't say anything more specific about Thrive's plans, but after it becomes publicly available we'll be back with a full analysis. 

Thrive homepage for its new JustThrive service 23 Sep 2008


Expensify Launches Decoupled Credit/Debit Card Using Prepaid Model

By Jim Bruene on September 11, 2008 5:59 PM | Comments (1)

image Like Rate Surfer, which we wrote about yesterday, Expensify launched its new employee expense-management system from the TechCrunch50 DemoPit this week.

The San Francisco-based startup (note 1) combines a payment card with a Web-based expense manager and uses cellphone cameras to upload pictures of receipts to match against purchases. It's a banking triple play: card, online, and mobile.

The target market is smaller businesses that want to automate expense report preparation, approval, and reimbursement to their employees.  

How it works
The heart of Expensify is a prepaid, decoupled credit card. I know that doesn't make sense, but here's how it works: 

  1. Sign up for an Expensify MasterCard prepaid debit card.
  2. Load it with value from any credit or debit card, Visa, MasterCard, or American Express. 
  3. Make purchases with the Expensify MasterCard.
  4. As each purchase clears, the prepaid balance is lowered, triggering an automatic "top off" charge of an equal amount to the consumer's credit card, thereby returning the prepaid balance back to the original level.

Metabank is the issuer; here are terms and conditions.

At first blush Expensify sounds pretty amazing. An expense management card that rides on top of your regular card, with mobile and Web-based integration. Brilliant, until you start thinking about costs. There's that pesky thing called interchange. What Expensify has done is create two card transactions instead of one, doubling the amount of interchange paid.

To cover the extra interchange and create some revenue for itself, Expensify levies a 3% transaction fee on the cardholder. Although the card is otherwise relatively fee-free, that's a significant surcharge.

Why would anyone pay 3% extra in order to use the Expensify card when they already have a credit card? The company believes that small businesses will pay the fee in order to get the expense-manager features and to help employees separate business expenses from personal ones. Businesses could have multiple Expensify cards tied to different categories of expenses (see screenshot below).

A business with just $1000/mo in expenditures would pay $360 per year. In addition, the business would tie up several hundred dollars in a prepaid account, because the only charges cardholders can make must not exceed the prepaid balance held in the Expensify account. 

I think the expense-management concept is good, especially with the mobile receipt integration, but it's just too expensive in its current format. The founders should try to move to an ACH-based "topping off" process and remove the transaction fees. 

But regardless of how this specific product performs, the integration of payments, online and mobile, is a huge trend. If Expensify is nimble enough, they may be able to ride the wave.

Expensify homepage (10 Sep 2008)


1. Since I didn't see contact info on their website, here's what the founders provided at TechCrunch50: Expensify, 548 Market St. #61434, San Francisco, CA 94104, Phone: 801.745.9064

Comments (1)

Shryk Launches iThryv, Online Banking for Youth, at TechCrunch50

By Jim Bruene on September 9, 2008 12:36 AM | Comments


Two huge tech conferences opened today in California with 124 companies launching new products this week in front of a combined audience of more than 2,500 (see note 1). At DEMOfall in San Diego, 72 companies are launching new products today and tomorrow. In San Francisco, 52 companies launch at TechCrunch50 today through Wednesday.

Eight of the 124 companies are related to financial services:

We'll cover several of these companies, plus several in the TechCrunch50 DemoPit, starting with iThryv.

iThryv kicks of TechCrunch50
imageI made it down from Seattle this morning just in time to catch the first demo. I'm glad I got up early because it just so happened to be the only personal finance/banking-related finalist. Oklahoma City-based Shryk kicked off TechCrunch50 (note 2) by unveiling its online banking platform aimed at the 12- to 20-year-old crowd. The new service is called iThryv and it will be marketed directly to banks and credit unions who will customize and brand it for their own customer base.

iThryv will be integrated directly to the bank, or its core processor, so that real-time banking data can be displayed in various widgets. In addition to account info, iThryv also includes the following modules and features:

  • Goal-oriented savings, including rewards for reaching milestones
  • A spending & savings score that does for savings what a credit score does for loans
  • Make $ area where budding entrepreneurs can learn more about starting a business
  • Learn area for financial education

The company has a two-fold approach to getting iThryv into the market:

  • Licensing the platform to banks for a fixed fee plus per-user fees
  • Giving the platform to schools to incorporate into their curriculum

According to the founders, the service is currently being considered by several financial institutions, but it is not yet available online.

iThryv homepage (8 Sep 2008)

iThryv homepage 8 Sep 2008

 iThryv savings score graphed (8 Sep 2008)


iThryv "Make $" tab
(8 Sep 2008)


1. TechCrunch reported approximately 1,700 attendees; DEMOfall, 800.

2. iThryv was originally scheduled to present third, but were moved up to first when Ashton Kutcher was late for his scheduled demo of his startup, Blah Girls.


Pertuity Direct to Launch Person-to-Person (P2P) Lending Service

By Jim Bruene on August 27, 2008 5:14 PM | Comments

">Link to website Last September, we wrote about the launch of Washington D.C.-based Pertuity Direct. At the time, the startup was showing some interesting social-personal finance tools such as Dare to Compare, which allowed users to compare their financial situation to their peers and national norms (see "before" screenshot below). It looked like another online PFM play.

But it turns out the company's true business model is person-to-person lending (aka social or P2P lending) where it will compete with Prosper, Lending Club, Loanio, and others (see note 1). Its URL redirects to a non-functional placeholder page (below) that includes only an email signup (note 2).

Here's the company description of its strategy:

Pertuity Direct is bringing the next generation of social lending to the Web - integrating simplicity, liquidity and automatic diversification into the social lending model.

The founder is Kim Muhota, an ex-banker out of PNC Bank. Pertuity Direct, which is currently closed to the general public, will demo its new product at our October Finovate conference.

Current: Pertuity Direct placeholder page with email signup
(26 Aug 2008)

Pertuity Direct temporary homepage 26 Aug 2008

Before: Pertuity Direct website before redirect put in place

(see note 1, 26 Aug 2008)

Previous Pertuity Direct homepage

1. For more on the P2P lending space, see our Online Banking Report on Person-to-Person Lending.

2. You can see the previous website content by following a deeper link available from Google.


Intuit Launches Quicken Beam: Free Text-Message Alerts & Balance Inquiry

By Jim Bruene on August 25, 2008 12:59 PM | Comments (1)

image Intuit joined the messaging race with the beta release of Quicken Beam. The free service sends users text-messaged balance-and-activity alerts from most U.S. bank, credit card, and credit union accounts. Users may also query the service for balance plus last five transactions by texting "Bal" to the short code 636363.

Currently, the service runs independently of Quicken and can be used by anyone free of charge. According to the official press release, the service was developed in Intuit Labs.

What's innovative
It's not a new feature. Quicken Online (see second screenshot below), along with most major banks and personal finance specialists (Mint, Rudder, Wesabe), already supports text-message alerts (see note 1). But this is a relatively low-cost way to hook users early on with an extremely simple service, then migrate them to more robust Intuit services later on (Quicken, QuickBooks, TurboTax).

And the Quicken stamp of approval means a lot when turning over your log-in credentials to a third party. If you want to talk to the company about Quicken Beam, Intuit will be demo'ing the latest features of Quicken Online at our Finovate Conference in October. 

Financial institutions that lack text-message support might consider linking customers to Quicken Beam. Yes, you are turning customers over to another financial provider, and yes, your compliance folks will hate it. But customers are going to do it whether you want them to or not. You might as well get credit for making a solid recommendation. And realistically, using Quicken Beam is unlikely to hasten anyone's exit from your bank or credit union.

Qucken Beam homepage (25 Aug 2008

Quicken Beam homepage 25 Aug 2007

 Text messaging in Quicken Online (25 Aug 2008)

 Text messaging in Quicken Online

1. Geezeo really differentiated itself with mobile capabilities in its May 2007 launch. 

2. For more information, see our Online Banking Report on Personal Finance Features.

Comments (1)

Rudder (formerly SpendView) Launches New Mint-like Personal Finance Site

By Jim Bruene on August 23, 2008 11:44 AM | Comments

image There's a new challenger in the online PFM space, aptly named start-up Rudder which is headquartered in Houston, TX (see note 1). The company was founded in 2007 and launched last year under the name SpendView (note 2).   The company raised $2 million in January from Meakem Becker Venture Capital. The founder is Nikhil Roy

What's innovative
While it's a bit busy for my tastes, Rudder's homepage is aesthetically pleasing, and more importantly, lays out a number of remarkable benefits that every financial institution should be able to deliver on:

  • Finances in your inbox: emphasizes that it's pushing info to you, not relying on your obsessive monitoring of a website
  • Paying bills on time: They don't just help you pay the bills; Rudder makes sure you pay them ON TIME, a huge difference in terms of consumer benefits
  • Think forward: Everyone has a sense of what they really have in the bank after upcoming expenses are met, but Rudder actually does the math for you and shows you what's truly "free cash" in your account after accounting for upcoming payments
  • Every morning: Rudder provides a personal-finance heads-up each morning so you can go about your day without thinking about your finances
  • Safe & secure: Self-explanatory, but cannot be overlooked

Clearly, Rudder has been studying how Mint grabbed an early following with great design, advanced functionality, and a brash point of view. However, it won't be able repeat Mint's PR coup last year of winning at TechCrunch40 and our Finovate 2007 (see note 4). Rudder has scheduled its public debut at competing techfest, Demo Fall, running Sept. 7-9 and unfortunately were not on our radar screen until after the Finovate 2008 lineup was set (note 5).

What it means
You gotta love Web-based startups. It took a decade for Wells Fargo to move from delivering plain old statement info on its website to offering rudimentary personal finance functionality in My Spending Report.

But less than two years after Wesabe (note 2) kicked off the Personal Finance 2.0 era, we have dozens of cool personal finance companies looking to make a name for themselves. Mint (note 2) is the most hyped (see coverage), but there are also great things going on at Geezeo, Jwaala (note 3), Buxfer, ClearCheckbook, Mvelopes, and, of course, Quicken Online, which has Coke-like brand awareness.

And don't rule out the incumbent financial institutions. PNC Bank (post here) and Frost Bank (post here) have both introduced novel accounts that incorporate advanced personal finance functions. And Bank of America has offered full-service PFM functions since late 2006 with Yodlee-powered MyPortfolio.   

Rudder homepage with five key benefits highlighted (21 Aug 2008)


Your "real" balance widget
I love the focus on what you really have in your account, after netting out all the known bills in the coming month. Here's the graphical feedback Rudder provides.


1. Rudder seems like a good name for a financial management app. What do you think Jeffry?

2. The previous version, SpendView, is still live at <>, but the original now redirects to

3. See Wesabe and Mint demo their latest features at the upcoming Finovate 2008. Mint won Best of Show at Finovate 2007.

4. Jwaala was Best of Show winner at Finovate Startup, April 2008.

5. Attention startups: It's never too early to make an introduction and get on our Finovate watch list. We're already putting notes together for 2009. Contact Online Banking Report/Netbanker editor Jim Bruene

6. For more info on the space, see our Online Banking Report on Personal Finance


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