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Personal Financial Management Archives

Mobile PFM: Tracking Automobile Trips

By Jim Bruene on April 14, 2014 6:44 PM | Comments

imageLast week, MileIQ cracked the top-50 in Apple's "Finance | Free" category. Think of it as Fitbit for cars, running in the background automatically logging all car trips (and killing battery life). 

At the end of each trip, users categorize the trip by swiping left for personal or right for business (see screenshots below). Users can also annotate transactions by "flipping" them over and typing basic details (see screenshot 2 below).

That's basically all there is to the mobile part. Users go to the companion desktop dashboard (screenshot #5) to further categorize trips, stitch the various segments into a single trip, delete items, add parking and toll fees, edit the tags, manually add a trip and create reports.

You can also create a quick email report at the push of button from within the app (screenshot #6).

It's free for 40 trips per month, but then costs $5.99/mo or $60 annually. It could make for a nice auto loan/lease premium item.

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Relevance for FIs
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This feature would be a nice fee-based value add for personal financial management (PFM) programs. But the more interesting aspect is the UI. Banks could provide a similar function for handling all transactions. Users swipe to the left to categorize a transaction as tax-deductible/business or right if not. Later, just the left-swiped transactions could be tagged with more specific categories (business travel, charitable contributions, etc).

This simple approach every so slightly "gamifies" mobile transaction processing, helping users save money and better manage their finances. 

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Screenshots
Mobile UI

#1 (left) Main page shows drive(s) to classify
#2 (right) Annotation available on the "back" of each drive card

 image        image


#3 (left) Congratulations for handling all transactions  
#4 (right) Pricing options

 image       image


#5 Desktop dashboard

image

#6 Quick email report, generated by button in mobile

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1. We've tackled PFM numerous times over the years in our Online Banking Report. Most recently here (subscription).

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Fintech Four: Banno, Borro, Personetics & Auction.com are on a Roll

By Jim Bruene on March 5, 2014 12:40 PM | Comments
It's been a crazy week in fintech, and it's only Wednesday morning. Because my brain can hold no more than four stories at a time (and that's a stretch), it's time to publish a "fintech four" mid-week. I don't know which of these is more dramatic, so I'll go in alphabetic order: 

1. Auction.com joins the billion-dollar fintech club

Thumbnail image for auction.jpgI'm not sure everyone considers Auction.com a fintech play, but as an online asset sales platform (which moved $7 billion last year), it's close enough for me. It just raised a fresh $50 million from Google Ventures at a valuation of $1.2 billion. So I'll be adding Auction.com to our "Fintech billion-dollar club." 

>>> Metrics and more from Bloomberg here.


2. Banno acquired by Jack Henry

banno.jpgWhile we don't know the $$ number, given the traction Finovate alum Banno had in the market (375 bank clients), and the relatively high valuations in the fintech space these days ($1.75 billion for Stripe), this must have been a pretty nice payday for the owners and investors in Iowa-based Banno (formerly T8 Webware). Founder Wade Arnold is staying on at Jack Henry and is super excited about his future with the Kansas City-based technology vendor. 


English: Wordmark of Borro, the characters &qu...
3. Borro borrows $112 million

In one of the biggest fundraising rounds in fintech history, UK-based Borro landed $112 million to further its high-end online pawn brokerage business. I met founder Paul Aitken last fall and was impressed with the product, which allows consumers to borrow against non-liquid assets like that Jacob Lawrence in the hall, at pretty high rates (3% to 4% per month). Until then, I had no idea there was a large, underserved (near prime?) market holding high-end assets (outside Downton Abbey anyway). Even so, I was shocked to see a $112 million round. While terms of the deal weren't disclosed, I have to believe all or part of the money is debt, not equity. So I'm not going to add Borro to the billion-dollar club, yet. Apparently online lending is back! 

>>> Average loan amount = $12k (against a $20k value)... see Press release
>>> TechCrunch breaks down the Borro loan process and metrics here


4. Personetics is on a roll

pesonetics.jpgAt this week's Bank Innovation great event in Seattle, I finally had a chance to meet face-to-face with Personetics, the Sequoia-backed "predictive financial services engine." I've been impressed with what I've read about the company, and loved the Fiserv demo at FinovateEurope last month (demo here) featuring a forward-looking PFM piece powered by Personetics. But I had no idea how much traction the company was gaining in less than three years since its A-round. While I can't name names, if even one of these deals moves into production, it has the potential to change the face of online banking. 

>>> Fiserv demo at FinovateEurope featuring insights powered by Personetics here (12 Feb 2014)

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BillGuard Brings Email-Like UI to Mobile Banking Transaction Flow

By Jim Bruene on January 22, 2014 10:35 PM | Comments

image The ink wasn't dry on my 2014 wishlist, when I got a message from BillGuard founder Yaron Samid, informing me that its new mobile UI was already doing what I'd most hoped for:

Wish #1: A Gmail-like priority inbox/feed for my financial transactions.

It's as yet not quite Gmail-level functionality -- for example, I'd like more tagging options than just "flag for later" -- but compared to the state-of-the-mobile-art today, it's pretty awesome. Thanks to BillGuard for getting the year off to a great start (note 1).

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How it works
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imageBillGuard aggregates credit and debit card transactions and flags suspicious items for review (see previous posts). So in that way, it has always acted like the Priority Inbox function within Gmail.  However, its desktop UI looks more like a traditional PFM than an email inbox.

But for the smartphone, BillGuard has dramatically changed the interface. As you can see in the inset, they use "Inbox" as the name of the transaction register. There is even a red bubble showing how many new charges are available for review (see inset right).

The five primary items on the main screen:

  • Large green "card" >> Summarizes current month spending across all aggregated cards (you can also swipe through the individual cards)
  • Inbox >> New transactions and any that you've flagged for followup
  • All >> All transactions in a single infinitely scrolling list (I have 1,000+ transaction going back 3 years, and I can scroll through all of them in less than a minute). You can look at all transactions or just the recurring ones.
  • Analytics >> Month-over-month spending graphs
  • Savings >> Merchant-funded offers

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imageMore on the UI
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1. Inbox view (click screenshot for a larger graphic):

  • Transactions are sorted with suspicious and unknown merchants listed on top and new, unviewed transactions below
  • Users can choose the right "Follow Up" tab to view only those transactions they have flagged for followup (see #x below)
  • User can swipe the transaction right to move it out of the new transaction inbox, as shown in the green "Metropolitan Market" transaction at right

2. Transaction detail image

  • The transaction "card" contains expanded info on known merchants such as full name, location, and URL
  • There are three key buttons:
    A. Green checkbox to okay the transaction, removing it from the inbox
    B. Orange "followup" button to keep the transaction in the pending list for later review
    C. Small gray box in upper right with a number that indicates how many transactions you've had with this merchant; clicking it brings up the list of all (10 in this case)

 

image 3. Merchant offer

  • Based on my transaction history, a discount offer from Target is displayed; clicking the green button brings up redemption options, in this case:
    - Email offer
    - Shop now

 

 

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Notes:
1. The mobile UI was actually released in the latter part of 2013.
2. Screenshot at top of post is an iPhone notification.

Comments

Fintech Four from Last Week

By Jim Bruene on November 25, 2013 3:01 PM | Comments

Since my previous Fintech Four (when Bitcoin was a lowly $200), it's been an interesting few weeks. Here are the standouts last week:

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One: Coin is an overnight YouTube sensation
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image Who would have guessed a $50 payment gadget could be a viral hit? In the week since it was announced, the 105-second demo video (made Sandwich Video) has racked up more than 6 million views, 26,000 likes, and almost 9,000 comments. The company said it's original $50,000 crowdfunding goal was hit in 47 minutes, they have not said how many have been sold since. According to a button on its site, the pre-order period will last 30 days.

Many of speculated about why this happened, but the most concise summary is on Quora written by Brian Roemmele. He lists five reasons:

1. The product solves a real problem, too many cards in the wallet

2. Coin implies there is a limited supply

3. It was selling at for a limited time at 50% off

4. It appealed to early adopters with a blend of "old" meets "new"

5. $5 referral credit (against the $50 cost) with a built-in sharing button at the end of the purchase process.

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Two: The latest fintech prize winners
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Fintech startups have been taking home awards at various fall tech events this fall. Here are six winners in from the past 10 days:

1.  imageFinovateAsia Best of Show winners from Singapore (post):

image2. Innotribe Disrupt winner at NextBank LatinAmerica (Bogota, Columbia)

  • Intoo, a 6-person Brazilian small business financing portal, won the Latin American round of the year-long Innotribe contest 

image3. Get In the Ring winner at this Dutch startup competition (Rotterdam)

  • EyeVerify (FinovateSpring 13) took home $11,000 in cash, plus a potential million euro investment, for its eyeprint authentication technology (post)

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Three: Finovera launches "PFM for your bills"
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Finovera (FinovateSpring 13), officially launched its billing/PFM portal and landed a favorable TechCrunch post. The service competes in the PFM space, but is more focused on the billing and payments side (along with Manilla and doxo). Unlike analyzing/charting spending, the process of organizing, paying, and archiving bills is a near-universal need. So, it's an area that retail banks should pay close attention to (note 1). 

image 

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Four: Virtual currencies gain more real-world backing
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U.S. regulators didn't exactly endorse Bitcoin and other virtual currencies, but they didn't condemn it either (Financial Times article). That was enough to send prices through the roof, touching $900 by some reports, a nice 50x gain since Jan 1. Most assets that appreciate so rapidly fall back to earth, but no one knows for sure if Bitcoin isn't than 1-in-a-million item that defies common sense.

But this is not JUST a Bitcoin story, it's about the "Internet of money." And it could be the biggest financial innovation since the credit card. However, it's still boggles my mind that regulators who are having a hard time letting normal people invest in privately held companies, are not clamping down on unregulated virtual currency trading. This story is far from finished. 
 

Table: USD value of a Bitcoin at Mt. Gox (last 6 months)

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Notes:
1. For a deeper dive, see our report on paperless billing and banking (Nov. 2010, subscription).
2. All Finovate alum videos are available free of charge at our Finovate.com website. 

Comments

Group Banking Gets an App, A Look at Yodlee's Tandem

By Jim Bruene on November 20, 2013 8:50 AM | Comments

image In the six years PM (post Mint), dozens of startups have launched with the goal of simplifying group finances. For the most part, they've started with two use cases:

1. Sharing rent and utilities among roommates
2. Splitting the bar/dinner tab among friends

Those are the significant financial problems faced by 24-year old founders living in the Bay Area or Brooklyn. But for the rest of the world, those are relatively small or non-existent issues. What we need are financial collaboration tools for adults.

But I'm happy to report there is finally an app for that. And it's from a fintech company known for providing the PFM plumbing, not the fixtures, Yodlee. The company's Tandem app made its debut in September at FinovateFall earning a Best of Show award. Tandem repeated with another Best of Show at its international debut last week at FinovateAsia (upper right).

imageTandem uses a four-layer "financial circles" approach inspired by Circles in Google Plus (see inset left):

  1. You
  2. Inner circle: Used to transact
      with family members 
  3. Friends: Used to share expenses
      with groups of friends 
  4. Advisors: Used to collaborate 
      with professional advisors  

The app allows the various circles to jointly manage financial issues, such as siblings chipping in to manage and elderly parent's expenses. The brilliant thing Yodllee did, which is often overlooked, is to imagefocus on the communications about group finances. Compared to the relatively simple transaction, communicating is often far more time consuming, prone to error, not to mention creating ill will.

In its demo (right), Yodlee showed how siblings could communicate within Tandem about a suspicious charge on their mom's account. Each person in this financial circle are depicted with thumbnails at the top. Each can communicate with the others using the text-message like interface (lower half of the screen).

Bottom line: There is still hard work required to make Tandem a reality. Yodlee is in discussions with a number of potential clients, but doesn't expect it to be live much before mid-2014.

Even so, Tandem is the type of tangible improvement that PFM has long promised (note 1). I'd love to move beyond text messaging, and use Tandem to better sync financially with my son when he heads off to college next fall. 

But don't take my word for it, here's a final thought from USAA's acclaimed innovator, Neff Hudson (Tweeted during FinovateFall, 10 Sep 2013)

image

 
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FinovateFall 2013 Demo 
Check out Yodlee CEO Anil Agora and VP Katy Gibson show it off at FinovateFall (note, this is not an embed, click on the picture and you'll go to the webpage where you can play it):

image

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Post-show interview of Anil Agora, by Finovate's David Penn:

clip_image002For some, PFM innovations are like hearing that the Dallas Cowboys have a new coach or the New York Yankees have a new pitcher. At the end of the day, they are still the Cowboys and the Yankees and you either love them or you don’t.

But you could almost hear the collective “yes!” when the Yodlee team presented the “shared finances” feature of their PFM app, TANDEM. Who knew the ability to manage finances for elderly parents or high school age children without having to talk with your ex-husband (or ex-wife, I assume) would be so popular?

Congratulations to Yodlee for helping make PFM new again. Here are a few thoughts on TANDEM from Yodlee President and CEO Anil Arora.

Q. Why did Yodlee win Best of Show?

Anil: We think Yodlee won Best of Show at FinovateFall with our Tandem app for two simple reasons: 1.) It’s truly unique, and 2.) Everyone in the audience could relate to it personally.

With nearly 70 presenters, it’s challenging to create something that is dramatically different. We saw a void (and opportunity) in the market to go beyond traditional money management conversations around budgeting and spending to create real dialogue and action around relationships. One of our favorite tweets recognized that “life is messy.” We are all complicated and social beings. So Tandem was designed to both embrace that and to help create some order and peace of mind around how we manage finances within the context of personal relationships (children, spouses, aging parents, teams, friends, roommates, etc.).

Our goal was to tell the Tandem story through real-world use-cases that everyone can understand. We used scenarios such as having a child in college who needs money for school purchases, communicating with siblings to help an aging parent manage bills and protect against fraud, and business partners working through the process of getting a business loan with their bank. These are just a few of hundreds of scenarios that we all face every day where our new Yodlee Tandem mobile app could play a valued and proactive role in both the communication around finances and actual money movement. It’s safe, easy, and relevant to every day life.

Innovation is key to Yodlee’s DNA. We are passionate about creating a platform and an ecosystem that solves real problems, breaks down technical barriers, and moves industries forward. We hope our new Tandem app does all that!

Q. What would you like to add to what we’ve learned from your demo?

Anil: Telling a complete story in seven minutes is really tough. For example, we showed only a few use-cases for Tandem out of the hundreds that exist. When you’re excited and passionate about how an app can change lives, it’s hard to choose just two or three instances to show the crowd. We also would have loved to add more about the ease and power of how someone can actually set up a financial circle. It’s very easy and it’s very powerful.

The financial circles concept of communication within pre-determined social circles is really unique, and the ability to control the account-sharing access is paramount. This clearly distinguishes Tandem from other apps and services. We haven’t seen anything else in the market where you can securely interact with others around specific accounts and transactions with distinct parameters around what is shared and accessed, from specific (tagged) transactions to full account access with a trusted advisor. Tandem enables full control while empowering users to have a real dialogue around important financial matters in real-time.

Q. What can we look forward to over the next three to six months?

Anil: Since Finovate, we have received tremendous interest in the Tandem app. We’re really excited about seeing Yodlee Tandem live and in action providing value to millions of people around the world. We’re already getting substantial consumer feedback on both the concept and the user experience and that will increase exponentially when the app goes live.

We will provide Tandem to existing and new customers within both our financial institution business and also within our API business to consumer services companies, large and small. We believe this is a very useful and valuable app that will engage people in all-new ways around managing financial relationships and having productive conversations about a very sensitive topic: money.

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Notes:
1. We've tackled PFM numerous times over the years in our Online Banking Report. Most recently here (subscription). 

Comments

New Banking Business Models

By Jim Bruene on August 15, 2013 5:27 PM | Comments

image There will likely be a few more post-mortems on Perkstreet's failure to create a viable business using a debit-card rewards model (note 1). Whether its downfall was due primarily to unfortunate commodity pricing (my theory), lack of demand from the debanked (see Ron Shevlin's post), or something else entirely, it's interesting to ponder just what problems are big enough to support VC-backed bank-like entrants (note 2). 

I wrote the following piece for our OBR clients a year ago (note 3). It seems even more pertinent today in light of Perkstreet's failed $15 million bet.  

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Embracing New Business Models for a Digital World

For 20 years, online and mobile banking has been bolted on to traditional business models. Exceptions are few: ING Direct, PayPal, Virgin Money and several other smaller players (note 4).

The bolt-on strategy worked amazingly well. Major U.S. banks have lost virtually no deposit, loan or fee-income market share to upstarts in the Internet era. Robust profits allowed incumbents to build online and mobile capabilities without sacrificing their brick-and-mortar channel.

But the banking world changed in 2008. Worldwide recession, regulatory price controls, an uncertain lending environment, low rates and increased competition from VC-backed startups have all combined to make holding on to market share less certain.

We see three areas where financial services startups could gain ground:

  • Digital financial advocate
    Positioning
    : Consumer advocate in the cloud always watching over your transactions and financial well-being; and can tap investors (crowdfunding) to get you some needed cash
    How: P2P lend + aggregation/PFM + P2P pay + insurance + service + safety
    Who: Mashup of BillGuard + Mint + Lending Club
  • Virtual CFO/CPA
    Positioning:
    Digital business partner supporting financial activity, accounting and capital needs
    How: Payments + P2B lending + aggregation + bookkeeping/accounting + fraud protection
    Who: Cross between Funding Circle and Xero
  • Personalized mutual fund
    Positioning
    : Personalized and highly automated mutual fund/ETF
    How: Simple UI + limited options highlighting appropriate choices (think Hipmunk) + systematic savings + automated rebalancing
    Who: Betterment on steroids

These businesses require sophisticated software, such as PFM modules, fraud protection, and business management functions. It will be fascinating to watch it unfold.

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Photo credit: ThePeacefulMom

Notes:
1. My apologies to Dan, Jason and the rest of the team. I imagine it's frustrating to see your valiant efforts reduced to fodder for blog posts. We'd be happy to host if you want to publish a guest post with your observations.  
2. If IBM really paid nearly $1 billion for Trusteer, I guess you can add "fighting financial malware" in the category of big problems.    
3. See Online Banking Report #208/209 (subscription)
4. Certain other countries have experienced more disruption. But in most developed countries the incumbents as a whole have held on to most of their market share.

Comments

Gamification & Banking

By Jim Bruene on August 9, 2013 7:02 PM | Comments

image I don't know what we did before the term gamification was coined. Back in the day we just talked about comparisons, metrics, charts and so on (or maybe "game mechanics" if you working on your PhD). But it's nice to be able to wrap those concepts up into a single term, even if it does have a bit of a frivolous, video-gaming connotation. 

But, let's not get hung up on the wording. Call it what you want, but the concept of providing detailed feedback about your customers' use and abuse of their money is a critical part of being a 21st century financial provider. My absolute favorite thing about Mint is the weekly financial summary its been sending me for five years. It's still the single most important financial tool I use.

Since it's Friday, I will cut directly to the visual aid (screenshot below). The weekly activity tracking summary from FitBit provides good ideas for a comparable financial version. For example:

  • Totals for the week
  • Daily averages
  • High/low days
  • Badges
  • Color coding: green is good, red is bad
  • Leaderboard (if you are sharing with friends)
  • Thumbnail picture (if you've uploaded)

Have a great weekend!

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Weekly Progress Report from Fitbit (6 Aug 2013)

image

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Notes:
1. Graphic from WePlay, a London-based marketing consultancy.
2. For more, see the Online Banking Report PFM library (subscription required): PFM 4.0 (June 2012); Alerts & Streaming (July 2010);  PFM 3.0 (May 2010); Social Personal Finance (June 2007); Personal Finance Features for Online Banking (Aug 2006).

Comments

Will mobile finally make PFM popular?

By Jim Bruene on July 29, 2013 7:15 PM | Comments

image In the online desktop era, we’ve seen only one direct-to-consumer PFM mega-hit: Mint (see note 1).

But looking at recent rankings in the U.S. Apple App Store (iOS) it looks like that may be changing. There are currently five specialty PFMs in the 13 most-downloaded free finance apps, including Mint of course. Is the mobile device finally what will make PFMs popular with consumers? Or are these apps just being downloaded by curious smartphone owners who will never register for the service, let alone become active users? 

My Take: Mobile is, and will be, a huge driver for specialty PFM apps. App stores help consumers find the services, and mobile makes them less daunting to use. But it’s not just the mobile platform driving usage at these four challengers (see below), it’s the way they have positioned themselves with tangible consumer benefits (e.g., save money by spotting fraud charges) rather than the nebulous (e.g., "manage your spending for a better life").

Parsing this list a little closer, only Mint is positioned as a pure PFM. The challengers are all backing into PFM from various niches:

  • imageBillGuard (#5) is positioned as a fraudulent charge protector
    and accomplishes that through account monitoring. It appeals to
    those concerned about losing money to fraudsters and greedy merchants.
  • imageLemon (#7) is positioned around mobile wallets and payments, but it also offers account monitoring as a premium service. It appeals to early adopters wanting to use their smartphones for payments and all things financial. 

  • imageManilla (#12) revolves around billing and financial statements, but obviously aggregated bank and credit card statements is a core PFM feature. It appeals to those wanting better management of their mess of paper bills, receipts and records. 

  • imageCredit Karma (#13) focuses on credit scores and debt management, but recently extended into full account monitoring. It appeals to those wanting to improve their credit scores and better manage debt.

Because most consumers have no interest in looking at a bar chart of their spending, it makes sense to sneak in the PFM piece through more compelling, benefit-laden service offerings. For banks, all four of these approaches are worth a look. 

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Table: 20 most popular free finance mobile apps in U.S. Apple App Store 
Does not include several non-financial apps

  Name Primary Type
1 Capital One Bank/card
2 Chase Bank/card
3 Bank of America Bank/card
4 PayPal Payment
5 BillGuard (note 2) PFM: cards
6 Wells Fargo Bank/card
7 Lemon PFM: cards
8 Mint PFM: general
9 American Express Card
10 Scottrade Investing
11 USAA Bank
12 Manilla PFM: billing
13 Credit Karma PFM: debt
14 Discover Card
15 Citi Bank/card
16 Xoom Money Transfer Remittances
17 TD Bank Bank
18 Venmo (Braintree) Payments
19 Fidelity Investing
20 US Bank Bank/card

Source: U.S. Apple App Store accessed via iPhone 5 from Seattle, WA on Fri. July 26, 2013 at 11 AM PDT 

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Notes:
1. Not counting bank-branded PFMs from Intuit, Yodlee, Geezeo, Money Desktop, et al. And not counting the packaged-software stalwarts from the 1990s, Microsoft Money and Quicken.
2. BillGuard moved up to the #1 position over the weekend and remains there as of 6:00 PM PDT today
3. Check (formerly PageOnce) should also be considered in this discussion. It has been a top-20 finance app for the past few years, despite currently running in the lower 30s, probably due to its recent rebranding to an entirely new name
4. For more info, see the Online Banking Report PFM library (subscription required): PFM 4.0 (June 2012); PFM 3.0 (May 2010); Social Personal Finance (June 2007); Personal Finance Features for Online Banking (Aug 2006).
Comments

PFM: Playing the Trust Card

By Jim Bruene on July 15, 2013 7:43 PM | Comments

Having been involved in the PFM industry for two decades, I've long taken the position that it was the bank's business to lose. While consumers may not always like their bank, most continue to trust them with their money. And that's an advantage not easily overcome by newcomers. 

imageI was reminded of the trust factor when I looked at Change Sciences latest report on PFM usability (subscription). As you can see at right, the researcher charted Trust (horizontal axis) vs. Likelihood (to use the service).

The two most trustworthy PFM offerings, by a significant margin (+20%), were operated by banks:

  • PNC Virtual Wallet
  • Chase Blueprint

It was less clear how trustworthiness correlated with trial. In this 12-company study, users were most likely to try the most trusted site, PNC Virtual Wallet, after sampling it. But Chase, with the second most trusted site, was tied with less-trusted sites Mint and newcomer Pocketbook (headquartered in Singapore) for likelihood to try. Not surprisingly, many factors besides trust will impact trial. 

Bottom line: With only two bank-run PFMs in the chart, there isn't nearly enough data to conclude that banks have an inherent trust advantage in personal financial management. And even if they do, it's difficult to prove that trust actually LEADS to more usage (trust could simply be correlated, without causation).

Nevertheless, these two data points are encouraging for banks. Both PNC and Chase, who have invested millions on personal financial management, have managed to wow consumers with their offering. PNC Virtual Wallet has also previously finished on top of the Change Sciences UX scorecard.

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Note:
For more info, see the Online Banking Report PFM library (subscription required): PFM 4.0 (June 2012); PFM 3.0 (May 2010); Social Personal Finance (June 2007); Personal Finance Features for Online Banking (Aug 2006).

Comments

First Look: Moven Bank's Online Application

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

moven1.jpg

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. 

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1. Moven invite (1 July 2013)

moven2.jpg  

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

moven3.jpg

3. Name and email confirmation

moven4.jpg 

4. Terms and conditions
Note: Issuer is CBW Bank

moven5.jpg 


5. Choose 4-digit PIN

moven6.jpg 

6. Personal info

moven7.jpg 

7. Verify mobile number

moven8.jpg 

8. Funding

moven9.jpg 


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

moven10.jpg 

10. PFM linkage

moven11.jpg 


11. Confirmation email

moven12.jpg 

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Notes:
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).

Comments

The Simple Finance Game or "Hiding PFM in Plain Sight"

By Jim Bruene on June 13, 2013 7:16 PM | Comments

image I've written thousands and thousands of words about personal finance management (PFM) including seven deep dives in our Online Banking Report (see note 1) and 130 131 blog posts. However, I've never articulated the behavioral aspects as well as NY Times software developer Andre Behrens who pens the occasional post at NYTimes.com.

In his Tuesday article, Gamification Done Right, he uses (Bank) Simple as an example of a great use of game mechanics: 

Simple.com is the most beautiful bank site I’ve ever seen...but aesthetics are just a baseline. Because what Simple actually wants to do is get you to play a game. The game is called “Master Your Finances”....

HPFM lite: Bank Simple safe-to-spend balancee then describes a key part of this game, which Netbanker readers will recognize as Simple's Safe-to-Spend balance:

If there’s one number you’re guaranteed to see on a bank site, it’s your balance...I take this number for granted...what other number could there be? But once you start playing the Simple Game, you realize this is a number that matters to the bank much more than it matters to you. What you care about is how much money you can use right now.

He goes on to write about how Simple encourages users to keep savings in unique buckets associated with goals:

...saving has always felt to me like denying myself fun spending opportunities. In the Simple Game, the opposite has proven true. Because every goal has a name and a committed plan, and because the transactions are presented in small increments, saving has become an anticipatory pleasure.

Bottom line: Read the whole article. It may help reinvigorate your efforts to infuse basic PFM concepts directly into everyday online/mobile banking. Every customer should be able to reach the first level of the finance game simply by logging in. How do you take it to the next level? That sounds like the makings of post #132, 133, 134 .....      

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Note:
The OBR PFM library consists of three reports penned a decade ago on account aggregation, the PFM enabling technology pioneered primarily by Yodlee. Then four reports in the modern PFM era looking at features, benefits and bundles (subscription required):
-- June 2012: PFM 4.0 here
-- May 2010: PFM 3.0 here
-- June 2007: Social Personal Finance here
-- Aug 2006: Personal Finance Features for Online Banking here
-- July 2003: Account Aggregation 3.0 here
-- Aug 2000: Account Aggregation 2.0 here
-- Oct 1999: Account Aggregation

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Should You Install Mint@Yourbank?

By Jim Bruene on April 4, 2013 11:12 AM | Comments

image Yesterday, Intuit announced a Mint-branded PFM that banks can install within their secure online banking sites (press release). Several pilots are beginning shortly, but widespread availability is expected towards year-end.

The service will contain similar functionality as Mint offers directly today. However, FI end users will not see third-party offers, unless the bank decides to run them. See the mockup below for what Mint will look like running within a retail bank.

Many of Intuit's 1,100 online banking clients (500 of which use Intuit's FinanceWorks PFM) will jump at the chance to integrate Mint. Non-customers will be considerably more wary. See the pros and cons below. 

I was briefed by Intuit's Mint folks Tuesday, so I've had 36 hours to ponder the implications (see note 1). As Aite's Ron Shevlin blogged yesterday, the move comes as no surprise to anyone. But now that the moment has arrived, banks and credit unions must decide if they want to cede PFM branding over to Mint. There is no right answer, but here are a few pros and cons to ponder: ________________________________________________________________________________
Pros:

  • Mint is THE brand name in PFM. In fact, it's probably the best known name in all of personal finance, not counting big financial institutions and payment brands. When I tell friends and family what we do at Finovate, I usually get blank stares until I say that we have companies like Mint on stage demoing their new products. Then they get it; everyone seems to have heard of Mint. So it will be easier to educate the market by simply saying, "we offer Mint built right in to your online banking."
  • Current Mint users can import their history and aggregated accounts right into your bank's secure site with the click of the button. With 12 million registered users (note 1), that means that about 10% of your customers base has already set up an account there and could be off and running MUCH faster than using your home-grown service.
  • Tax integration: While some may view this as a con, the links between Mint and sister product TurboTax, provide a nice solution for banks to push during tax season. 
  • Attractive UI: While the other players (notably Money Desktop) have caught up, if not surpassed, Mint on the UI front, it still provides a UI that is head and shoulders above the typical banking site.
  • Early mover advantage: If you are the first in your market with Mint integration, it could provide a meaningful competitive advantage while you have that space to yourself. And the advantage could remain if you are thought of as "that bank with Mint" for the next few years.
  • Jump-start mobile money management: Few banks have anything beyond basic balance/transaction info in mobile banking. Whereas Mint is now acquiring almost half its customers in the mobile channel.
  • Your customers already use it: A typical bank has 10% of its customer base registered with Mint (though the active user base is much smaller). Those customers are being served competing offers whenever they login to Mint.com. Those offers are replaced with your marketing messages when using Mint@YourBank

________________________________________________________________________________
Cons:

  • It's an added expense, potentially a significant one: Intuit declined to get into specifics of the cost, but they said there are per user per month charges. If I were Intuit, I'd start the costs low, and raise it aggressively over time as customers were locked into the platform.
  • Control goes to Intuit: Right now, financial institutions are in the drivers seat. Mint is popular and growing, but it's unlikely to achieve true mass-market status without better integration into financial institutions. And if it becomes the industry standard, then banks may have less power in future negotiations.
  • Brand confusion: Adding another brand to the mix (i.e., one that competes with your FI brand) is always a tough call. And if other banks offer the same Mint-branded PFM, have you lost the potential for competitive advantage? Furthermore, does driving your customer into Mint actually make you more vulnerable if Intuit or someone else releases a "conversion kit" to move all your account to Mint.com or another bank's Mint service. And will customers even bother to move from Mint.com to Mint@Yourbank?  

_________________________________________________________________________________
Bottom line: It's a great move for Intuit. They extend their distribution, potentially dramatically, and better monetize Mint (note 2). And it gives Intuit a platform to develop additional services to sell to client banks. 

Should financial institutions jump on board? Assuming you can overlook control issues, it will boil down to the usual outsourcing issues (cost, support, integration, etc.). So, if Mint@YourBank looks economically feasible, it's worth putting on your short list. The automatic conversion from Mint.com is a huge benefit. The known brand should make customer/employee education easier. And if you move fast, you can leverage the Mint brand to position yourself as the "personal finance" leader in your market.

But if you want to control your own destiny, avoid conflicting branding, and potentially lower costs (note 3), you may be happier with other solutions. 

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In this Intuit-provided mockup, Mint appear on main navigation and in two primary sections within online banking (3 April 2013)

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Clicking "Mint" on main nav bar leads to this familiar spending screen

image

 

Secondary navigation leads to all the usual Mint functionality, for instance "Budgets" shown here

image

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Notes:
1. For me, Mint has come full circle. I still remember nervous Mint founder, Aaron Patzer, at our first Finovate in 2007 (demo video). He was riding high after his win at the inaugural TechCrunch40 (now Disrupt) two weeks earlier, but he was afraid he'd be caste out by the banking audience he was attempting to disrupt. His fears proved unfounded as the audience voted Mint Best of Show. Now, his former company is making a bold bet that those very banks will now promote the Mint brand to their customers. 
2. According to an estimate by Steven D Jones at Dow Jones (no relation I presume), Mint brought in less than $3 million during Intuit's fiscal second quarter. However, that does not include substantial cross sales of TurboTax and QuickBooks, which together are a $4 billion annual business.  
3. I'm making the assumption that as the premium name in the business, Mint will eventually cost more than other solutions. That may or may not happen, as Intuit is large enough to subsidize the service for at long as it sees fit.
4. Intuit will be demoing at FinovateSpring in May.
5. For more on balance forecasting and other advanced PFM features, see our Online Banking Report: PFM 4.0 (June 2012; subscription).

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Lemon's Premium Digital Wallet Carries Monthly Fee

By Jim Bruene on February 8, 2013 3:53 AM | Comments

image I've spent a fair amount of time playing with digital wallets during the past few weeks. The one with the most traction, at least measured by download activity, is the Lemon Wallet which has been a top-20 free finance app for some time.

While it's free, does cool tricks with the mobile camera, and is seemingly liked by users, it's not a transactive service just yet. Basically, using the mobile camera as a scanner, it digitizes all the bank cards, loyalty cards, IDs and various detritus we haul around on our person or stuff into the back of a desk drawer.

Right now, there aren't many places willing to accept a copy of your card stored on your smartphone. But if you need your healthcare plan number, driver's license number, or any of your card numbers, they are all stored in a handy location (you could do the same thing with the iPhone's notepad too).

Obviously, Lemon has bigger plans than simply being a card-number archive. You don't score $8 million in venture capital unless you have a path towards a $75+ mil valuation.

The startup's first step towards revenue generation is its $4.99 per month (or $39.99 annually) premium option. For that, users get a bundle of benefits including:

  • Card transaction scanning powered by BillGuard,
    which downloads transactions to monitor up to 10 cards
    (1 account can be tracked in the free version)
  • Lost wallet service (aka credit card registration) so that if you lose your physical wallet, Lemon will handle getting all your cards replaced
  • Extra password for more security
  • Transaction sharing
  • Export data to CSV (Excel), Evernote, Dropbox or Concur

My take: For power users, the BillGuard integration makes Lemon premium worth the $3.33.mo on an annual plan. One mistaken charge discovered every year covers the cost. But account aggregation is not something consumers are used to paying for, so by simply providing fee-based PFM services, it will take time to get meaningful revenues.

But with a solid base of cards aggregated onto the platform, Lemon can leverage the info in many ways. And as mobile proximity payments become technically feasible, the company is in a good position to be one of the major wallet players (or be acquired by one).

Email upsell for the Lemon premium option (5 Feb 2013)

image

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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).

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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

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PFMs Are Top Browser "Money" Plugins for Google Chrome

By Jim Bruene on January 24, 2013 8:29 PM | Comments

image While they are overshadowed by the hundreds of thousands of mobile apps, there is a growing eco-system of plugins and apps for use with desktop browsers. I recently poked around in the Money section of Google's Chrome Web Store.

Not surprisingly, Google Finance was the most popular with almost 300,000 users. Mint was second at about half that (160,000 users). No one else was close (see table below).

Of the top 11 money plugins, six were PFMs: Mint, Finance 41, CashBase, PocketSmith, Easy Envelope Budget, and Toshl. Four were investing related, and Zillow tracks residential real estate (note 1).

One surprise: There was just one U.S. financial in the store. BofA? Fidelity? PayPal? No, it was Mountain America Credit Union (screenshot below). There were several international financial institutions in the store as well (Maybank, BBVA, Bradesco).

Bottom line: With 700,000 total users across the top-11 apps, this is a niche market so far, and could remain that way. But interestingly, it's another place where Mint dominates.

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Table: 11 Most Popular Chrome Extension
in the "Money" Category

Name Users Type
1. Google Finance 283,000 Investing
2. Mint 161,000 PFM
3. Zillow 49,000 Real estate
4. Finance 41 41,000 PFM
5. Cash Base 35,000 PFM
6t. Pocketsmith 34,000 PFM
6t. Wikinvest 34,000 Investing
8. WealthLift 28,000 Investing
9. Free Stock Charts 20,000 Investing
10. Easy Envelope Budget 18,000 PFM
11. Toshl 15,000 PFM
TOTAL 710,000 --

Source: Google, 18 Jan 2013

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Mountain American Credit Union extension for Google Chrome browser (link)
Note: The app currently has 127 users

Mountain American Credit Union extension for Google Chrome browser

PFM Toshl featured in the Google Chrome Web Store (link, 18 Jan 2013)
Third-party PFM Toshl was one of the featured apps in the broader Lifestyle Category. They have about 15,000 users, making it the 10th most popular app in the Money category.

PFM Toshl featured in the Google Chrome Web Store  

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Notes:
1. And Finovate alums are well represented. In addition to Mint, Pocketsmith and Wikinvest, BillGuard, FutureAdvisor, Xero, ImpulseSave and SmartyPig (previous post) have plugins.
2. For our take on PFMs, see our May 2010 Online Banking Report (subscription).

Comments

Card Transaction Data is Rich, Who Will Help Users Mine It?

By Jim Bruene on January 15, 2013 7:27 PM | Comments

image A few days ago, my wife and I were trying to remember the name of a restaurant where we ate on vacation several years ago.

The answer didn't really matter, but I shouldn't have needed to tax my meager memory cells because someone with perfect recall already knows its name, location, and how much was spent. In this case, Bank of America. I used its credit card.

I should be able to hit BofA's mobile app, type or speak "orlando," and instantly see the dozen or so charges I've made in Central Florida. Even better, I should be able to access the entire paper trail of card charges from that trip and to get a quick refresher of our itinerary four years ago. 

Yes, this is the vision of personal financial management and we are slowly getting there. But it's still a lot of work to manage the data flowing to third-party PFMs. And logging in to yet another program to find a small bit of info can be tedious (see note 1).

Bottom line: We can debate all we want about how many people will use the mythical thing called PFM. But most people want to know something about a past transaction at least once in a while. They shouldn't have to subscribe to a third-party service find it.

So, listen up, financial institutions. Follow Simple's lead (and Jwaala which pioneered it five years ago), and make long-term searchable transaction archives a core part of online and mobile banking (notes 2, 3).

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Simple's natural-language search is an important feature (15 Jan 2013)
Note: Hashtags make subsequent searches even more powerful

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Jwaala search

image

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Notes:
1. Though, for me, Mint's QuickView Mac app, has made transaction look-up much faster by doing away with the login.
2. And you can make "transaction search" a profit center. See Google's business results for ideas.  
3. For info on fee-based financial services, see the Online Banking Report (subscription) on fee-based online services (May 2011); paperless banking and online storage (late 2010); and lifetime statement archives (2005).

Comments

Making Banking Interesting

By Jim Bruene on December 19, 2012 9:35 PM | Comments

image When did banking become boring? Probably when all the gold doubloons and pieces of eight were replaced by paper checks and computer bits.

But it doesn't have to be this way. Most people have at least a passing interest in where their money is going. Sure, there are some negative issues around money, but the place where you track your spending and savings should at least be engaging. And that's rarely the case today.

But Bank Simple (and others) are making good progress.  

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Simple Innovation #8: Full transaction annotation
with on-the-fly categories

______________________________________________________

As the startup continues to push the UI envelope (see note 1), it now lets users annotate transactions with uploaded images or PDF files (for a pic of that tantalizing dinner or the receipt for expense reimbursement), free-form memos, and categories created on the fly (#category like on Twitter).

That allows customers to create a historical record around their purchases. Or as Mechanics Bank's Bradley Leimer put it:

"I love it. It’s like Pinterest or Instagram in your banking application." 

For a more thorough look at the UI, check out the new video posted on the Simple blog.

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Fully annotated transaction at Simple (19 Dec 2012)

image

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Notes:
1. See previous seven Simple innovations here.
2. Expensify offers similar photo capture and memo annotation capabilities
3. For more info on Simple and other Truly Virtual Banks, see our Oct 2011 Online Banking Report (subscription). image
For more on balance forecasting and other advanced PFM features, see our recent Online Banking Report: PFM 4.0 (June 2012; subscription).
4. According to Apple iTunes, Simple app downloaders are also "buying" Schwab, PageOnce, and Mint apps.

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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. 

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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.  

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

image


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

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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

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Notes:
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)

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Launching: KeyBank's "myControl Banking" Provides Balance Forecasting via Mobile App & Online Dashboard

By Jim Bruene on November 20, 2012 11:31 PM | Comments

imageKeyBank is launching a new online banking and mobile service called myControl Banking. The mobile app became available today in iTunes (link).

The service is centered around myMoney Forecast, a real-time balance forecast shown at the top of the screen (see inset below). It's a vital PFM function that looks a lot like Simple's Safe-to-Spend.

But there is one significant difference. Key Bank users can make the forecast more accurate by manually entering Money In or Money Out transactions before they clear the bank (for example, a just-written check, see bottom of first screenshot). The bank automatically nets out any pre-scheduled bill payments, transfers, or ACH items and adds in recurring regular paychecks and transfers in. 

Key Bnak mobile myMoney ForecastThe interface also includes a weekly cash flow calendar so users can monitor the flow of their funds. And up to five goals can be established and tracked within the app and/or online dashboard. 

The mobile app does not (yet) replace Key Bank's regular mobile app. Before using MyControl, customers must sign up for it within online banking.

Analysis: The introduction of MyControl Banking is a fantastic move. It delivers the key missing component of online banking, a peek at what's about to happen with cash flow, without making users slog through a bunch of PFM features they don't understand.

imageIt provides Key Bank with meaningful differentiation, and gives them a platform to add more PFM content in the future.

Because Key Bank's MyControl raises the bar in digital delivery, we are giving it our OBR Best of the Web award (note 2). We are also retroactively naming Simple as a co-winner since they commercialized a similar balance forecast earlier this summer.

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Mobile checking & savings balance visualization with integrated transfer button (left) and goals (right)

Key Bank myControl Checking     KeyBank myControl Savings mobile

Key Bank myControl Banking landing page (link, 20 Nov 2012)

image

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Notes:
1. This post was developed from info available within the app, in the product video at Key.com/mycontrol and in the FAQs. But I don't have an account at Key Bank, and there is no interactive demo yet, so I haven't used the service with live data.  
2. Since 1997, our Online Banking Report has periodically given OBR Best of the Web awards to companies that pioneer new online- or mobile-banking features. It is not an endorsement of the company or product, just recognition for what we believe is an important industry development. In total, 88 companies have won the award. This is the first for Key Bank and Simple. Recent winners are profiled in the Netbanker archives.
3. For more on balance forecasting and other advanced PFM features, see our recent Online Banking Report: PFM 4.0 (June 2012; subscription).

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Op Ed: The Convergence of High-Tech and High-Touch in Wealth Management

By Jim Bruene on September 4, 2012 3:53 PM | Comments

by JP Nicols

JP Nicols, CFP, is CEO of the advisory firm Clientific and has served in various industry leadership positions, most recently as Chief Private Banking Officer for U.S. Bank. He writes about the intersection of leadership, advice and innovation on his blog at jpnicols.com.

Disruption of long-held paradigms and business models are common themes in fintech generally, and at Finovate especially. Some of the most notable traction to date has been in the payments and personal finance space.

Now, innovative specialty lenders and crowdsourcing platforms are also breaching what had long been banks' deepest moat -- the ability to leverage and monetize their balance sheets.

Wealth management in the digital age
The wealth management business has been less commoditized, and some firms have deployed impressive intellectual capital to help clients grow, preserve and transfer their wealth. Despite the rise of digital personal finance platforms and tools, clients with higher levels of wealth and complexity need and want advice from time to time.

A recent American Banker article cited a KPMG survey that said 9 out of 10 banks were considering a major overhaul of their strategy, and 40% said that wealth management was essential to growing revenue. For good reason. Wealth management operations are typically efficient users of capital, represent lower risk business models and are higher producers of precious fee income.

It makes sense for incumbent firms to increase investment in higher-margin businesses while new entrants are left to focus on lower-cost solutions. This is the classic pattern of disruptive innovation as described by Clayton Christensen and others.

Then as these new entrants gain market share, they inevitably move upmarket. In fact, that is already happening.

From the underbanked to the overbanked
There has been considerable discussion about the unbanked and underbanked, people who either cannot or will not use traditional financial institutions. Prepaid cards, payday loans, check cashing, remittances and other services that fill the gaps have seen new innovations and new investments from both inside and outside the industry.

On the other hand, wealthier households, or the overbanked, have no shortage of providers eager for their profitable business. But disruptive forces are at play here from two areas:

  • Smaller firms which differentiate with high touch, lower client/advisor ratios, better defined market niches and more responsive service.
  • High-tech competitors with better user interfaces, more robust web and mobile tools and sophisticated analytics.

The convergence zone
The effectiveness of those two approaches varies somewhat along demographic lines, but it's not as simple as assuming all older customers prefer high-touch while the younger set always wants a technology solution. 

Web and mobile adoption rates in older age groups rise with higher income, and affluent customers are looking for something more than a stock jockey with a briefcase full of papers.

On the flip side, even the savviest do-it-yourself millennial wants help from an expert every now and then, and simply replacing the irrelevant stock jockey with a prettier, but equally irrelevant, screen full of dials and charts isn't enough for many.

So these powerful forces are beginning to converge in a couple of exciting ways:

  • Enterprise solutions have been gaining traction at Finovate. Past alums like InStream and Balance Financial created inviting portals for advisors to manage their business and collaborate with clients in ways previously not possible.
  • A few firms have built their own advice and back-office platforms behind compelling interfaces. Finovate alums like Wealthfront and Betterment  offer low-cost professional money management to every investor.

Three firms to watch at FinovateFall 2012
I will be paying particular attention to three firms that are contributing to the convergence of high tech and high touch at FinovateFall 2012:

  • imagePersonal Capital a Best of Show winner at FinovateSpring 2012, leverages it's PayPal and Intuit DNA (CEO Bill Harris led those companies too) to create what  they call a "next-generation financial advisor completely personalized around you." Users can easily get started for free with their attractive and useful PFM tool, then upgrade to their money management services.
  • image MoneyDesktop is another Best of Show winner at Finovate Spring 2012 that brings a slick mobile- and tablet-friendly PFM desktop with customizable widgets as a white label solutions for FIs stuck with outdated interfaces. They recently acquired MoneyReef to further bolster their mobile PFM offerings.
  • imageActiance: Fear of running afoul of FINRA, SEC and other compliance requirements is one of the barriers in large wealth management firms' struggle to  be relevant in social media, and significant intellectual capital too often remains in proprietary channels as a result. Actiance has been a very visible solution provider with their Socialite platform, and at Finovate they will be showing off their integration with Salesforce to further integrate social data.

I will be back after the show with my thoughts on the latest developments in wealth management and track the convergence through integrated offerings and enterprise solutions.

Changing the world is hard. Changing bank IT departments takes a little longer.

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Notes:
1. Image licensed from ShutterStock
2. For more on Personal Capital and the rise of the truly virtual financial institution, see OBR #198 (Oct 2011, subscription)

Comments

Communicating Account Aggregation Issues: BillGuard Puts Extra Effort into Contacting Customers

By Jim Bruene on July 19, 2012 2:52 PM | Comments (2)

image One key "advanced PFM feature" (see our most recent report for more) is the ability to track outside accounts under one roof, a.k.a. "account aggregation." But a nagging problem remains with this wonderful automated solution: "login maintenance."

The user must do some fix-up work whenever their login credentials are changed for one of the accounts or when the bank throws a curveball to the aggregation robots. It happens a lot and is one of the main reasons customers stop using aggregation services.  

PFM providers struggle with how best to educate and motivate users to stay on top of this routine maintenance.

BillGuard uses a proactive approach that I like. When I recently changed the password on a credit card, the company sent me an email explaining that they were no longer able to access my transactions and that it was probably from a "change in the way the bank handled logins" (see first screenshot below). In my case that wasn't true, so it would be helpful if BillGuard also mentioned that the cause could be a password/username change.

Then the company did an excellent job walking me through the maintenance process and providing positive strokes at the end of the process, e.g., my card is now "protected" (last screenshot).

But I especially appreciated BillGuard's extra effort during the aggregation process after I'd reestablished the login to my credit card. Since it was taking extra time to download the transactions, BillGuard asked if I'd like to continue waiting or close the session and have the results emailed to me (see second screenshot). Excellent customer advocacy!  

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BillGuard email about "card connection issue" (12 July 2012)

image


During the download process, BillGuard asked if I'd prefer to close the page and have the results emailed

image

Close-up of the message

image


After aggregation is reinstated, BillGuard shows my card is now "protected"

image

Comments (2)

Mint Launches Mac App: Mint QuickView

By Jim Bruene on July 17, 2012 3:56 PM | Comments (1)

imageI've been a big fan of apps ever since I first pressed the weather button on the iPhone in 2007. After 12 years of http://www.blahblah.com/blah.htm, it was refreshing to just press a button and get the necessary information quickly, perfectly rendered and distraction free.

So I like Mint's latest move, putting a similar user experience onto the desktop (see note 1) with an app for the Mac (link) that provides a quick overview of balances, transactions and alerts (see email announcement below).

Once installed, Mac users simply click on the Mint icon on the top and/or bottom of their desktop, and it immediately opens to a display of the latest balance-and-transaction info. Like iPhone apps, the icon also shows the number of unread alerts on the badge (see first screenshot). 

Other novel features:

  • A search bar along the top of the transaction search
  • Optional password protection: You can choose to look at your data without logging in (after the first time)
  • Timed password protection: Users can select how long they can look at the data before the password prompt is shown  

I've used it for only a few minutes, but it looks like it will become my primary method of accessing Mint. Unless you need to run a report, it has most of what you need available immediately, shaving 30 to 40 seconds or more off the time to retrieve info from the full website version.  

image Bottom line: Mint is the first PFM or banking app to hit the Mac store, beating all the major financial brands to the punch. And it's been rewarded with "featured app" status which has propelled it to the very top of the Free Apps ranking in the Mac App Store (see inset above).

Because it raises the bar in the delivery of banking info, we are bestowing it with our fourth OBR Best of the Web award for 2012 (see note 2). 

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Mint QuickView app pops up after clicking on icon along the top

Mint QuickView uses dropdown from top icon on Mac


Transaction search from top line

Mint QuickView features prominent transaction search


Net income view

Mint QuickView


Email from Mint announcing Mac QuickView
(16 July 2012)

image

Notes:
1. We wrote about moving online banking info to the PC desktop in our Online Banking Report in 2002 (subscription).
2. Since 1997, our Online Banking Report has periodically given OBR Best of the Web awards to companies that pioneer new online- or mobile-banking features. It is not an endorsement of the company or product, just recognition for what we believe is an important industry development. If anyone knows of other financial institutions offering a similar feature, let us know and we'll update the post. In total, 86 companies have won the award including Mint in 2007. Recent winners are profiled in the Netbanker archives.

Comments (1)

New Online Banking Report Published: Personal Financial Management 4.0

By Jim Bruene on June 26, 2012 2:43 PM | Comments

image While personal financial management (PFM) may be THE most important feature of online/mobile banking going forward, it's time to stop thinking of it as "product."

PFM is part of every thing you do when communicating account info to customers. The paper statement is a PFM tool. The call center offers PFM. Even the branch helps certain customers with their financial management.

But those old-school tools have limitations. They are expensive, difficult to customize, and aren't always timely or available.

So online banking has been a boon to personal financial management. Can you imagine going back to the world where you actually had to keep track of your balance in your check register?   

But 17 years after Wells Fargo put the first customer statement online, most customers are still stuck looking at an online rendering of their circa-1960 paper statement. It's an area ripe for disruption, and Mint.com, with 3% to 4% penetration of U.S. households, proved that users want better-looking, more functional online info.

However, unlike record stores, newspapers, and travel agents, incumbent banks and credit unions have a much better chance to stay relevant and hold on to their market share. Other than early-adopter types, few customers will entrust their money to Internet-based startups (Bank Simple may be poised to prove me wrong, we'll see). And even if consumers have the desire, it's often too much of a hassle to make the switch. 

As long as financial institutions stay up-to-date in online/mobile delivery, keep prices in check, and provide decent service, there are no compelling reason for customers to ever leave.

For banks, a big part of staying current is helping customers stay apprised of their financial situation, and helping them improve it. We are lumping those things together and calling it PFM. One of the biggest changes coming, thanks in part to Bank Simple making it central to their UI, is the forward-looking "balance forecast" (or Safe-to-Spend balance in Simple-speak). See last Friday's post for more on that.

But that's just the tip of the PFM iceberg. There are dozens of needed new features to bring online banking up to 2012 "web standards." 

In our new 54-page report we cover:

  • 23 primary PFM functions
  • 40 promising PFM features
  • Another 100 potential features
  • PFM forecast (U.S. household usage by PFM type)
  • The business case
  • Putting it all together in multiple service bundles, including fee-based premium options
  • PFM availability at the 30 largest U.S. banks and credit unions including our first look at Citibank's Financial Tools
  • Mobile PFM
  • PFM for couples

__________________________________________________________________

About the report
__________________________________________________________________

Personal Financial Management 4.0 (link)
Moving forward with the most misunderstood financial
service of the online era

Author: Jim Bruene, Editor & Founder

Published: 25 June 2012

Length: 56 pages, 12 tables, 16,000 words

Cost: No extra charge to OBR subscribers, US$495 for others here

__________________________________________________________________

Sample screenshot
__________________________________________________________

HelloWallet combines budget status (e.g., at "coffee shops") and a macro "left to spend" balance on its mobile view

HelloWallet "left to spend" balance

Comments

Feature Friday: Bank Balance Forecast

By Jim Bruene on June 22, 2012 11:49 AM | Comments

imageAs Simple begins the 6-month process of converting its 100,000-person wait list into paying customers, I expect much attention will be given to its flagship UI innovation, a forecast of your "free cash" after accounting for upcoming transaction. Simple has trademarked the feature as the Safe-to-Spend balance (screenshot below).

We've discussed it a number of times in our Online Banking Report (subscription), but we haven't explored it in Netbanker. Here's why balance forecasting is so important:

  • Intuitive UI: Hundreds of millions of people worldwide log in to their bank accounts at least weekly. Why? To see their balance and to make a mental calculation of whether things are on track. Whether they consciously think it or not, they are making their own calculation of what's left in the account to spend. And given how horrible the average person is at making complex math calculations in their head, it makes so much sense to put that number right in from of them at all times.
  • Advocacy: Doesn't everyone want to believe that the place where they entrust their live savings is looking out for their best interests? But events of the past five years have seriously eroded consumer confidence in financial institutions, especially large banks. Providing a new tool that really helps consumer understand their financial position, and reduce the chances of overdrafting, could go a long way in restoring confidence that the bank is not the enemy.
  • Gateway to advanced PFM services: Doing important calculations on the consumer's behalf is what PFM is all about. So showing that you have the wherewithal to make this important calculation, can be the entry point for delivering more advanced PFM services, hopefully at a profitable monthly fee (note 1).
  • Great competitive weapon: Want to compete with Bank Simple? Want to show you are ahead of the curve. This is a perfect, tangible feature/benefit.

Bottom line: This is not the easiest feature to add. Maybe one of the hardest. And you should expect to spend quite a bit of time explaining it to employees and customers. But it absolutely will be part of every online banking system and third-party PFM service (see also, HelloWallet's "left to spend below).  
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Simple makes it impossible to miss your "Safe-to-Spend" balance (22 June 2012)

Bank Simple "Safe to Spend" balance

HelloWallet's mobile app has a "Left to Spend" balance for both in total and for the specific budget category (22 June 2012)

image

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Note:
1. We are putting the finishing touches on an update of our PFM report (May 2010, subscription). You'll see an announcement here next week.

Comments

Out of the Inbox: Mint.com Pitches Capital One Credit Card in Triggered Email Alert

By Jim Bruene on June 14, 2012 4:04 PM | Comments

imagePrecise, content-sensitive advertising is extremely powerful. It's what made Google a giant. 

In financial services, the biggest advertising-driven success (after BankRate and Google), at least in terms of market cap, is Mint.com. Its revenue stream is entirely made up of targeted offers to customers who aggregate banking transactions on its site.

The company wisely uses email to deliver some of the advertising pitches. As we've discussed before, Mint is of the few financial companies directly monetizing triggered alerts.

We were impressed by the latest effort received Tuesday (see below). Having noticed that our Chase business card was used internationally, incurring a $14 transaction surcharge, they wisely pitched us a Capital One no-foreign-transaction-fee card.

Interestingly, we already have not one, but two of those Cap One cards (personal and biz) and they are both aggregated at Mint. So I'm not sure if this alert is more of a reminder to use our Cap One charge when traversing the world or that Mint doesn't check current product usage when cross selling (or they don't care). If Mint is only paid on performance (eg. by new accounts generated), then it doesn't matter to Cap One that they are marketing to an existing customer.

Bottom line: The example demonstrates the marketing value of hosting the aggregated accounts.

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Mint triggered alert (12 June 2012)
Note: The advertisement is two-fold. The banner with "apply now" is the most eye-catching, but also easier to ignore. There is also a text call to action above it, that looks more like alert copy. It says: "Stop paying extra to use your credit card overseas. Get a card that doesn't charge foreign transaction fees."

image

Comments

Personal Financial Management for Couples

By Jim Bruene on May 29, 2012 11:14 AM | Comments (2)

image Although, I've been married since Ghostbusters was in the theatres, I still (sort of) remember what it was like to have just one person's finances to manage. If I recall correctly, it went something like this:

Money in. Money out. Then hopefully, a dollar or two leftover.

But then you get married, and even if you have separate accounts (we don't), there is quite a bit more to it:

Money in. Discuss. Money out. Discuss. Oops, too much money out. Point fingers. Discuss a lot. Compromise. Try to do better next month.

imageAnd then you have kids and it gets even more complicated.

So why are PFMs all about the data and do little to help you collaborate about your money? Because they were mostly designed by single, urban, 20-somethings (I know that's not entirely true, but you get the point).

What we need is the "Facebook of PFMs" where you can share appropriate financial details with your spouse, family, parents and other financial stakeholders in your life (CPA, bank, advisor, etc). The same concept extends to businesses who have even more stakeholders to communicate with.

While I haven't seen anything that does this in the PFM space yet. There are some interesting web apps being developed that help couples sync their lives together. The first one I heard about was Pair, which has gotten quite a bit of press.

But there's a new entry, Toronto-based SimplyUs is more of an organizational tool that a photo sharing app (note 1). Right now it focuses on calendar and todo list sharing (screenshots inset & below). That's a great start, but an obvious next step is financial collaboration.

Bottom line: There is a large unmet need for collaboration tools linked to transaction accounts (for more info, see note 2). The opportunity is both for families and also micro and small businesses who will pay monthly fees for the service.

No tool can make financial management as simple as it was for our 23-year-old single self. But by harnessing the power of the synced mobile banking app, it should be much more manageable. 

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SimplyUs iPhone app (25 May 2012)

 SimplyUs iphone app     image

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Notes:
1. For more info on SimplyUs, see last week's TechCrunch post. 
2. For more info on the importance of banking the kids, see our Online Banking Report on Family Banking (July 2011). For more on financial collaboration, see Bank Transaction Alerts & Streaming (July 2010). And finally, our last PFM report is here (May 2010; subscription required for all).

Comments (2)

Change Sciences Names PNC Virtual Wallet Best Bank PFM with Mint.com a Close Second

By Jim Bruene on March 27, 2012 5:51 PM | Comments

image Researcher Change Sciences has been doing outstanding work in financial user experience for more than a decade. In the last year alone, they've published deep dives in online, mobile, social media, mortgage, small business, investing, and account opening. The company counts most of the major players as customers; typical reports cost $5,000.

Its latest, published this week, contains a much-needed look at the UI of personal financial manager (PFM) services offered through major banks.

The winner? PNC Bank, which not only took top honors for its Virtual Wallet, but also claimed the number-three spot for Wealth Insight, a service geared to high-net-worth clients, launched last September. Both PNC PFMs were designed in conjunction with IDEO.

Mint.com came in a close second followed by the biggest surprise of the survey Bank Simple, which tied with USAA as the second-highest scoring bank. 

For more info, download the research fact sheet.

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Overall PFM Ranking
points on Change Sciences scorecard

PFM ranking from Change Sciences
Source: Change Sciences, March 2012

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Notes:
1. Image from Italian band PFM <pfmpfm.it>
2. For our take on PFMs, see our May 2010 Online Banking Report.

Comments

Pageonce Adds Billpay; Showcases Multiple Mobile Apps on Single Page

By Jim Bruene on October 24, 2011 5:54 PM | Comments

image Last week, we looked at how Square makes a single webpage look great across various mobile platforms. Today, we look at the exact opposite problem. How to showcase your various mobile apps on a single webpage. 

Pageonce does it as well as we've seen, using a single showcase panel that includes all five of its mobile app platforms across the top: iPhone, iPad, Android, BlackBerry and Windows. Users can scroll horizontally to see two sets of screenshots for each platform.

The company also includes version number, date of the last update, and app size in the lower right corner. And of course, there's a link to download the appropriate marketplace to download the app. The Android page uses a QR code instead of a link.

In other news, Pageonce added bill payment to its iPhone and Android app today, moving ahead of Mint in the features arm race. The new Gold service, which we haven't tested yet, is priced at $4.99/mo, good news for fee-starved online financial providers. Mint says it has bill payment coming too. It will be interesting to see if they put a fee on it.

Relevance for Netbankers: The addition of transactional services such as bill payment makes third-party PFMs, or virtual banks such as BankSimple, bigger threats to mainstream banks and credit unions. As uber-consultant Richard Crone always says, "He who enrolls, controls."

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Pageonce iPhone app

Pageonce iphone app showcased on its website

iPad

Pageonce on ipad

Android

Pageonce on Android

BlackBerry

Pageonce on BlackBerry

Windows

Pageonce on windows phone

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Note: We cover mobile banking and payments periodically in our Online Banking Report (subscription).

Comments

ING Direct Read-Only Access Code for Third-Party PFMs

By Jim Bruene on October 20, 2011 5:05 PM | Comments

Ceramic Coffee Cup with Silicon Lid (530)To my knowledge, ING Direct is the only major U.S. bank blocking third-party PFM access. But users can direct their PFM around the gate with a special "read-only" access code.

How it works
It's not particularly easy to find, buried three levels deep in MyAccounts | Preferences | Access Code.

The default setting is Blocked, as you can see in the first screenshot below.

But once you find the page, it couldn't be simpler to set up. Simply press the blue Create Access Code button in the upper right, and in a split second, you have created a read-only access code and opened your account to PFM access.

To change back, you merely click the "Block" button in upper right.

The only thing missing is an explanation of what to do with the Access Code. Is it the username or password? While that's explained in an link from the first page, it's not on the second page where you need it. (BTW, it's the password).

The bank also confirmed the new code via email right away (third screenshot).

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Access code main page (20 Oct 2011)

ING Direct create access code page

New access code

New read-only access created at ING Direct

Email confirmation

ING Direct access code confirmation email

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Note: OBR subscribers can access our previous reports on security at OnlineBankingReport.com (published in 1999, 2003, 2004, 2005, 2007 and 2008).

Comments

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. 

image

Comments

Mint.com Helps Users Keep Track of What's Ahead with New Bill Timeline & Reminders

By Jim Bruene on August 25, 2011 7:31 PM | Comments

imageIt's hard to believe that Mint turns four next month. It made its financial industry debut at our first Finovate conference (demo here, Oct. 2, 2007) after having launched to the general public a few weeks earlier.

With 5 million registered users, and public ownership (Intuit), it's now "the establishment" that dozens of startups look to unseat.

Mint made a large stride forward this week with the addition of a bill-due-date timeline to its Overview page, the page that users land on after login (see inset and first screenshot below).

The company also expanded its text and email bill-due-date reminder system. A wizard launched from a promotion on Mint's main page (screenshot 2, 3) prompts users to establish reminders for regular household bills.

Bottom line: Mint's billing timeline is a good example of the forward-looking approach that's much needed in online and mobile banking.

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A timeline of upcoming bills has been added to the Mint.com's main Overview page (25 Aug. 2011)

A timeline of upcoming bills has been added to the Mint.com Overview page

Mint promotes the new feature with a huge interactive banner on the main  Overview page

image

In this pop-up box, Mint gathers together likely bills and asks if you want a reminder

In this popup box, Mint gathers together likely bills and asks if you want a reminder

A timeline of upcoming bills has been added to the main overview page

A timeline of upcoming bills has been added to the Mint.com Overview page

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Note: For more on online personal financial management (OFM), see Online Banking Report (published May 2010).

Comments

What Online Banking and the Weather Have in Common

By Jim Bruene on August 23, 2011 6:34 PM | Comments (1)

It's always 73 on the iPhone I've always been a bit obsessive about the weather. I blame it on my Iowa roots, where the economy ebbs and flows depending on the rain and sunshine, and where you have just about every type of weather condition, sometimes in the same day.

One of the main reasons I wanted an iPhone back in 2007 (in the days before the App Store and mobile banking), was to get a weather button in my pocket 24/7. But it wasn't until today I realized that weather info is a decent metaphor for where remote banking is headed.

Weather forecast on Google

Think about the weather displayed on your mobile or PC. You get some pretty good info about what's going to happen today, plus decent estimates on the next few days, followed by a SWAG on what might happen a week or two out. This is helpful for planning your clothes, weekend activities, and as a last resort, for making conversation (sorry family).

This is exactly what's needed in online banking, a FORECAST of your finances. You need to know exactly where you stand today, plus you need an accurate prediction of your cash flows for the rest of the week based on pre-scheduled payments, followed by reasonable estimates of how things stand for the next month based on historical income and expenses. 

image Most of the major PFMs are incorporating forward-looking views into their interfaces. It's probably THE most important missing element in today's online banking. A financial forecast should be shown right next to the current balance on the main account page.

Bottom line: It's not a perfect analogy. It's still important to track historical spending to look for waste, fraud, and opportunities to save (note 1). But consumers need help understanding their financial position going forward. So crunch the numbers for them and let your customers get back to their mobile entertainment, even if it's checking the weather in Yakutsk (notes 2, 3).

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Notes:
1. And you can help with that too; see BillGuard post.
2. Yakutsk, Russia, is the coldest city you can track on the iPhone (hat tip to my nephew Marcus).
3. And yes, that's an actual image stored on my iPhone. I don't make these things up.
4. For more on online personal financial management (OFM), see Online Banking Report (published May 2010). 

Comments (1)

Truliant Federal Credit Union Gives Away iPads to Promote FinanceWorks PFM

By Jim Bruene on August 11, 2011 4:04 PM | Comments (1)

image There are three huge usability challenges with online personal financial management (PFM):

  • It's hard to get started
  • It's a pain to keep up with tagging transactions to make the data meaningful
  • It can be disconcerting for many users to view spending summaries

That's why so few Americans engage in PFM, despite its obvious benefits (note 1). One way to tackle the first problem: Offer a sweepstakes or bonus to induce trial.

Truliant FCU is doing that with a late-summer sweeps encouraging members to log in and give its FinanceWorks (powered by Intuit's Quicken) program a try. Members who sign up for the PFM between July 6 and Sept. 29 are automatically entered into the sweeps. There is no cost for the service (note 2).

Prizes include:

  • $100 awarded each week
  • iPad 2 awarded each month

Total value of the prizes is about $3,000.

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Truliant FCU PFM sweeps (11 Aug. 2011)

Truliant FCU PFM sweeps

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Notes:
1. For more on online personal financial management (OFM), see Online Banking Report (published May 2010).  
2. We urge FIs to consider charging for value-added services such as online PFM. See our recent Online Banking Report, Creating Fee-Based Online & Mobile Banking Services (published May 2011) for the rationale.

Comments (1)

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 _______________________________________________________________________________

Analysis
_______________________________________________________________________________

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 Mint.com 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.  

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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; )

image

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

Comments

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.

___________________________________________________________________

Analysis
______________________________________________________________

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)

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Notes:

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.

Comments

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).

Analysis
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)

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

Comments

American Express Now Offers Basic PFM Functions

By Jim Bruene on February 10, 2011 5:23 PM | Comments

image I was pleasantly surprised today to find that American Express has slipped basic PFM (personal financial management) functionality into its online card management area (note 1). The company allows the user to tag transactions and view results in graphical format (see screenshots below).

According to the FAQ, each transaction can have up to five tags. And each user can create up to 200 unique tags to apply to transactions.

Significance: Combined with the categories automatically assigned to each transaction, American Express is now offering basic PFM services. Although a little clunky--a three-click process is required to add a tag--it's a nice addition and something every online banking service should support. 

How it works
1. Click the "Add Tags to Transactions" link on the right side of the Statements & Activity area (below):

American Express online account managment with tagging function

2. Select a transaction(s) and apply an existing tag or create a new one, then click the Apply Tag button (lower right):

Transaction tagging at American Express

How it looks
After apply the tag "Personal," it now shows up in the transaction listing:

American Express online transactkion listing showing user generated "tag"

Once tagged, users can view transactions by tag categories:

American Express view my tag

Or view graphs by tag:

image

Note:
1. The example shown is for a Business Gold account. I'm not sure how long it's been available. The first mention I could find about it via Google was Nov. 2010, so we'll go with that until someone chimes in with better info. 
2. For more on online personal financial management (OFM/PFM), see our Online Banking Report.

Comments

Unitus Community Credit Union Charging $2 Monthly for Geezeo-Powered Online Financial Management (PFM)

By Jim Bruene on January 6, 2011 6:09 PM | Comments (1)

image In what I believe is a first in the United States, a financial institution has begun charging a small fee for online personal financial management (PFM) services.

image Portland, OR-based Unitus Community Credit Union, with 68,000 members and $800 million in assets, launched its new Geezeo-powered PFM Total Finance in late 2010. Members pay $2 per month for the service following a 30-day free trial.

According to Laurie Kresl, VP planning & biz development at Unitus, the CU has 661 members signed up for the service as of this week, or about 1% of its member base, which is a solid start considering the monthly fee is not mentioned on the public website, but is disclosed as members sign up for the service (note 1). 

Quick take: While online/mobile access will remain relatively fee-free, we'll begin to see more fees for optional value-added services such as advanced financial management. Congratulations to Unitus for taking the lead on this one.

Unitus CU homepage features its new PFM offering (6 Jan. 2011)

image

PFM landing page (link)

Unitus Credit Union Geezeo PFM landing page

Note:
1. To sign up, customers first log in to online banking. The CU says it plans to add fine print to the landing page (above), disclosing the monthly fee.

Comments (1)

Extreme PFM: Bundle Launches Restaurant Recommender and Move-O-Matic

By Jim Bruene on December 16, 2010 8:02 PM | Comments (2)

image Once upon a time, personal financial management (PFM) software was used only by those with complicated finances (usually with lots of business expenses to keep track of) or those who made a hobby out of tracking their money.

This was enough to support Intuit's Quicken, but every other software solution either lost money, remained small, or folded.

Then along came Web 2.0, and it looked like that might change. Dozens of online PFM providers launched, gained some early traction, then hit a wall, requiring them to fold (Wesabe, Rudder), re-focus on white labeling (Geezeo, Strands), or stay small. Only Mint.com (now owned by Intuit) was able to make it as a major PFM destination riding a wave of publicity generated by being a tech darling.

So where does that leave us now? There are several obvious opportunities for personal finance companies:

  • Small businesses willing to pay for tools that save time and/or help them run their business better (Outright.com, Kashoo, Xero and many others)
  • Tools that satisfy specific needs with almost immediate time savings (Expensify for expense reports)
  • Tools that watch over your accounts to make sure you are not defrauded, cheated, or billed in error (in development at a number of companies)

And then there's the avenue that Bundle is working on:

  • Using the aggregated data to provide spending insights for everyone

Bundle's new tools
This week, Finovate Fall Best of Show winner (video), Bundle, released two new tools under the tab, Everybody's Money (as opposed to the other option, My Money)

  • Restaurant Recommender (see below)
  • Move-O-Matic: Clever name and revamped interface for a feature Bundle has been delivering since it launched a year ago (previous post) that provides spending comparisons between various cities (see note 1)
  • Restaurant Recommender is brilliant and could be a useful tool for anyone who eats out often (a much, much bigger audience than those that track their spending closely). It only works for NYC and LA right now, but more cities are in the plans.

Here's how it works:

  • Type in a restaurant name (I chose Balthazar, a place my parents treated me to on a recent birthday; see first screenshot)
  • Click the green Find Restaurants button
  • Bundle returns a list of other restaurants that Balthazar customers frequent, complete with a "loyalty score" that quantifies how much customers spend at each restaurant along with a confidence measure on the recommendation (second screenshot)

And because the startup uses actual spending data from 20 million cards in its algorithm, the recommendations are based on real data, not the sometimes biased results of online review and popularity sites. As Bundle puts it, users "vote with their dollars."

If Bundle and Yelp make APIs available, it would be great to see a mashup of Yelp reviews augmented with Bundle spending data. And it's yet to be seen if they can convert casual drive-by data traffic into hardcore PFM users. But for now, Bundle is a great discovery tool, if you live in NYC or LA.

Bundle Restaurant Recommender (16 Dec. 2010)

Bundle Restaurant Recommender (16 Dec 2010)

Results for NYC search on "Balthazar"
Note: Bundle increased the transparency of the recommendation by disclosing how many transactions were used to derive the correlation. In the case of the Balthazar Bakery, the choice was based on more than 87,000 transactions. Bundle also provide a measure of how confident they are in the recommendation (the blue bar). 

Bundle Results for NYC search on "Balthazar"

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Bundle move-o-matic compares Seattle to NYCNotes:
1. Regarding Move-O-Matic. Here's my original footnote followed by the correction (in italics):
Unfortunately, when you drill into the data, the results sometimes seem strange. Does anyone really think the highest income folks ($125k+) in NYC really spend $230 less per month than those in Seattle excluding housing costs (see inset)? Granted, we spend a lot more on coffee; still, not sure I buy this result.
(Update 17 Dec. 2010: Looks like this was user error in part aided by the tool's autofill which suggested NYC, which includes all 5 boroughs, when I typed N. If I'd have input "Manhattan" instead of NYC the results would be much different. The tool says I spend $1,500 more per month in Manhattan, that sounds much more realistic. My apologies.)
2. Bundle is backed by Citibank, Microsoft, and Morningstar
3. See Xero at FinovateEurope, Feb. 1.
4. For more on online personal financial management (OFM), see our recent Online Banking Report.

Comments (2)

Wells Fargo Launches Much-Needed Personal Finance Tool: ATM Cash Tracker

By Jim Bruene on December 9, 2010 4:56 PM | Comments

image While full-functioned personal financial management (PFM) has its strategic advantages, the truth is that most consumers will never use a financial tool that takes longer than the length of a YouTube video to figure out (note 1).

That's why I'm a big fan of what Wells Fargo has done with My Spending Report, a drop-dead simple method for periodically seeing how out-of-control your spending is. All you do is click on the appropriate tab within online banking and bang, you are instantly looking at a pre-categorized spending analysis. Let's call it one-click PFM.

ATM Cash Tracker (press release), the newest tool from the bank, is similarly simple to set up and use. Although it's initially designed for ATM users, the concept would work well online and even better via a mobile app.

Wells customers can add a Cash Tracker button to their personalized ATM menu (see first screenshot). When selected, the new tool will reveal the total cash withdrawn during the current month along with the average during the past 12 months. It tracks only cash withdrawn from Wells Fargo ATMs. 

That's a great ATM innovation, but it will be even better when extended to mobile/online and applied to all cash use. As soon as I take money out of any machine (not just Wells Fargo) or receive cash back at the POS, my total cash use should be reflected on an online/mobile widget along with historical comparison. And users should have the option to tag the cash with spending categories to help assign it to the proper My Spending Report bucket.

And for users opting for emailed ATM receipts instead of paper ones (note 2), the Cash Tracker totals could be added to the virtual receipt (see second screenshot).

Wells Fargo personalized ATM menu
Note: New ATM Cash Finder not shown

Wells Fargo personalized ATM menu

Wells Fargo customers can choose to have their ATM receipt emailed
Note: Option E (below) allows users to hide their account balance from showing on the ATM screen.

Wells Fargo ATM e-receipt options

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Notes:
1. And I'm one of those people, so this is not meant to be a condescending remark. Just a fact.  
2. Wells Fargo released the ATM e-receipt option in June (press release)
3. Photo credit: Colin/thetruthabout
4. For more on online personal financial management (OFM), see our recent Online Banking Report

Comments

Social Media Design: HelloWallet Integrates New Blog with its Twitter Feed

By Jim Bruene on July 26, 2010 4:13 PM | Comments

imageHelloWallet, an online personal financial management (OFM/PFM) provider that launched in March, sent customers an email today (second screenshot below) announcing several product enhancements including:

  • To-Do List: Added to the dashboard to help you keep track of upcoming bills, goal progress, new savings ideas and so on. Users can manually add any item and receive email reminders. 
  • Progress Charts: Helps monitor progress on savings and debt-reduction goals.
  • Split Transactions: Ability to split transactions into two or more budget categories.
  • More Deals: My Deals database expanded to more than 130,000 financial products.

These are solid enhancements and signal that HelloWallet will be a viable competitor in the OFM/PFM space (see previous post; note 1). I especially like the To-Do list, a relatively simple enhancement that helps increase the utility of the application. The company has attracted a steady flow of visitors, averaging about 25,000 unique visitors per month in May and June (see Compete chart below).

HelloWallet.com traffic estimates (U.S. only)

image
Source: Compete (link)

But the main reason for today's post is to highlight the design of HelloWallet's new blog at <hellowallet.com/blog>. The layout is visually appealing, incorporates social media sharing tools (Facebook, Twitter, RSS), and does a great job showcasing the company's Twitter updates in the right-hand column (see first screenshot). This gives the whole blog a vibrant, up-to-the-minute feel, without burdening readers (and staff writers) with too many blog entries.

So far in July, HelloWallet posted four blog entries and tweeted 53 times (2x per day), a good pace. Both the blog posts and Tweets contain a good mix of personal finance material, general info, and company news. 

HelloWallet blog front page (link; 26 July 2010)

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Email message announcing new features (26 July 2010)

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Note:
1. For more on the OFM/PFM market, see our recent Online Banking Report

Comments

Future File: Digitizing Paper POS Receipts

By Jim Bruene on July 23, 2010 5:48 PM | Comments (1)

image Some of the best innovations come from inventors that develop a solution to a personal pet peeve, then commercialize it. In financial service, Aaron Patzer has told the story many times about how he developed Mint to solve his own needs for a better financial management tool.

If I had Aaron Patzer's drive, or funds, I'd be working on a solution to digitize point-of-sale receipts. In our household, none of us can keep track of a receipt past the first 24 hours. Someone or some thing must come into our house during the night and make off with all paper receipts.

So when it comes to returning something to a store, we usually end up replaying this sad process:

  1. Try to remember where the receipt is
  2. Look for it
  3. Ask spouse if they've seen it
  4. Look again
  5. Curse bad memory (of spouse) and give up for the day
  6. Repeat above steps the next day
  7. Curse bad memory (of self and spouse) and give up for good
  8. Rehearse story to tell store on why you don't have receipt
  9. Return item to store without receipt
  10. Receive gift card instead of cash refund (because there's no receipt)
  11. Forget/lose gift card
  12. Curse paper receipts and vow to better organized

image

That's why I was excited to hear Square founder Jack Dorsey tell the audience at NACHA Payments in April that one of startup's key strategies was "focusing on the receipt" (see my Tweet right).

Shortly thereafter I met David Crossett at FinovateSpring 2010 who shared his vision of how his startup, ReadyReceipts (note 1) is gearing up to solve this very problem. The product, still in development, uses a unique approach that doesn't rely on the end-user carrying another loyalty card (thank goodness).

If you've ever bought something in an Apple Store (in the USA at least), you can see what he has in mind. Mobile POS systems that email you the receipt and skip the easy-to-lose paper altogether.

In addition to Ready Receipts and Square, a number of other companies are working on solutions including:

Relevance for Netbankers: Receipt management is a very real pain-point that costs consumers millions of dollars and millions of hours of frustration every year. Financial institutions, retailers, and/or direct online financial management (OFM) providers that solve this problem stand to gain market share and/or profitable fee income (see our recent Online Banking Report on OFM features for more info).

Intuit's QuickReceipts is tackling the lost receipt problem (22 July 2010)

Intuit's QuickReceipts

Intuit is spurring grass roots support by enabling visitors to send a Tweet requesting their favorite store adopt QuickReceipts (link)

Intuit's tweet campaign for its QuickReceipts

MyReceipts.com from Third Solutions promotes Whole Foods participation (22 July 2010)

image 

Note:
1. ReadyReceipts.com is currently under construction as they build out the company and product.

Comments (1)

Online Financial Management Pioneer Wesabe to Shutter its PFM Functions, Open Source its Code

By Jim Bruene on June 30, 2010 9:26 PM | Comments (5)

image I'm sorry to see that Wesabe has thrown in the towel and will shutter the financial management portion of its website, leaving just the online forums intact. Customers have until July 31 to export their financial data stored at the company.

I have been a long-time fan and have been inspired by founders Jason Knight and Marc Hedlund. The company was the first VC-funded player in the online PFM space, beating Mint to market by a good nine months back in 2006. We've written about them in Netbanker and Online Banking Report, and they presented on stage at our first FinovateStartup (2008 video). 

Wesabe's been pretty quiet this year and traffic has been on the decline, but it's still a respectable 40,000 uniques per month (see below). I was hoping they would soon be announcing a new round of funding, but obviously that didn't come through. But I am somewhat surprised no other PFM player stepped in to purchase the assets, especially given Mint's $170 million exit nine months ago (note 1). I'm afraid it's a sign that the standalone OFM space is struggling.

image
Source: Compete, June 30, 2010

It also illustrates the point we've been making for a long time: The first hurdle for market acceptance is trust. And it's difficult for a non-bank financial management startup to earn enough trust from enough people fast enough to survive. Mint proved that it can happen, but most OFM players will need to partner with banks and credit unions to overcome the trust barrier.

Still, the Wesabe case is surprising. Well into its fourth year, with a solid track record, a core group of fans, some cool technology, and a straightforward white-labeling model, it seemed the company had made it far enough down the trust curve to be one of the survivors. But in a Wesabe groups discussion forum a few hours ago, CEO Hedlund gave a pessimistic assessment of the company's revenue outlook. In response to several posts from members saying they'd gladly pay a subscription fee to keep the company afloat, he said:image

One interesting side note, Wesabe says it will open source some of the code base, so users can continue to operate the service on their own computers. That may create opportunities for scrappy entrepreneurs to build something from the ashes of Wesabe, a fitting tribute to the PFM pioneer.

Wesabe homepage (30 June 2010)

image

Notes:
1. Wesabe was philosophically opposed to taking outside advertising, figuring that it was not in their users' best interests, so the ad-sponsored biz model used by Mint was probably not on the table.
2. For more on the OFM/PFM market, see our latest Online Banking Report.

Comments (5)

New Online Banking Report Available: Online Personal Financial Management (OFM) 3.0

By Jim Bruene on May 24, 2010 7:46 PM | Comments

image

Online Personal Financial Management 3.0
Taking online banking to the next level with personal financial management tools and guidance (note 1).

It's been almost four years since our last full report on online financial management (OFM). At that time (summer 2006), there was no Mint, no My Portfolio from Bank of America, and few offerings from major fintech vendors.

Yodlee was the only major player with a true OFM product, one that by year-end 2006 would be on the map in a serious way as the machinery behind BofA's new offering (2006 post).

Back then, users that wanted financial management features still relied on desktop software, primarily Intuit's Quicken and Microsoft Money.

The market has changed dramatically since then:

  • Microsoft discontinued its desktop PFM altogether in 2009.
  • Mint launched in 2007, quickly picked up a million users, and was acquired by Intuit for $170 million in late 2009.
  • Intuit put Quicken online, then discontinued it, in favor of its new Mint.com brand.
  • Intuit purchased Digital Insight and is now providing Quicken-like functions to more than 200 banks and credit unions.
  • More than two dozen online personal finance companies have launched. And other than Mint, most have struggled to gain users. Many of the startups are now pursuing distribution deals through banks and credit unions.  

That's a lot of change in less than four years. But it's nothing compared to what will happen in the next four. In the report, we look at the increased role OFM features will play in future online and mobile offerings from financial institutions, specifically:  

  • The key tenets of online money management, and why less is more for many banking customers
  • How to mix and match features to develop the ultimate OFM package
  • How the mobile channel fits in to the mix
  • OFM website traffic (U.S.) for the past three years
  • Current number of OFM users and a 10-year forecast
  • The unique user experience of PNC Bank's Virtual Wallet (see previous post)
  • Why banks and credit unions have the upper hand in the battle for OFM users, but the rise of social networks creates interesting opportunities

Future file: The rise of the Virtual Credit Union?
In all our reports, we try to shed light on what's around the corner. From where we sit today, it seems likely that most money-management activity will take place through online/mobile channels at traditional financial institutions. But we also consider an alternate future where the social networks rise up to become powerful brokers of financial services (think Facebook Credits) and become what we call "virtual credit unions."

While it's too soon to predict whether the social networked-fueled virtual credit union takes root -- regulatory issues are a huge wildcard -- there's no doubt the social networks will have a dramatic impact on payments and financial services consumption.  

------------------------------

Notes:
1. The latest report is available at no extra charge to OBR subscribers here; and can be purchased for US$495 by others here. See the Table of Contents here (PDF). 
2. In this report, we use OFM as the acronym for online financial management. But these features are also referred to as PFM (personal financial management) in many sources including previous OBR and Netbanker articles.

Comments

PNC Virtual Wallet Redefines the Online Banking User Experience

By Jim Bruene on May 22, 2010 9:00 AM | Comments (1)

image I have been using my new PNC Virtual Wallet account for a week now (previous coverage of the application process). The account takes a novel approach to core online banking and money management. Honestly, the user experience is so different, I’m still digesting it.

I think I love it, but I want to make sure it’s not just the novelty I’m attracted to. And that it really makes sense for users to interact with their bank accounts this way. I cover the PFM/OFM features in the most recent Online Banking Report and will publish a complete analysis in the future. But <spoiler alert>, I’ll reveal the account’s secret now.

Calendar view.

PNC did not invent the calendar approach to tracking finances. Most of the OFM/PFMs and online banking platforms we’ve had on stage in Finovate during the past three years, eg. Mint, Fiserv, Metavante, Intuit and others, have it. 

But Virtual Wallet (VW) defaults to calendar view. And they don’t let you change that. If you are a VW user, you will be managing your finances in calendar-flow mode. The designers took a risk here, but I think it pays off. They are targeting younger users, who have not grown up viewing reverse-chronological transaction lists, so why not train them from the get-go in how to manage the past, present, and future on a single page.

The first time you log in, the software asks when you get paid so it can add those happy events to your cash-flow calendar. Then as soon as you start making transactions they show up on the calendar along with your current balance in a blue bar at the top of each date (see screenshot below). Also, future events such as bill payments, are shown on the appropriate day to keep you from overdrawing your account.

It’s a good way to see what’s happening. But it also seems like a little more work. Like I said, I’m still evaluating the user experience tradeoffs here.

image

The Pig
image As much as I enjoy exploring the big-picture ramifications of this new user experience, the real reason I finally opened a VW account is for the pig. Maybe it’s the Iowa boy in me, but I’m a sucker for pigs.

VW has a cute feature, admittedly aimed at somewhat younger customer than your typical banking industry analyst, that allows you to make a checking-to-savings transfer by punching the pig graphic at the top of the screen (note 2). And the oinking sound, followed by a the cash register, kaching, punctuates the transfer perfectly.

But it was a little annoying to have to confirm each punch with a popup window asking if I really did want to send $1 to my savings account (see note 1). How about just building an undo button to protect those who get a little carried away clicking that little oinker (see the pig in the upper right in screenshot).  

Notes
1. Users can change the default transfer amount so that punches are equal to more than $1. 
2. Users can customize the look and sounds their pig makes. I switched mine to an orange flame motif, which I’m not sure my farming ancestors would approve of.
3. We awarded PNC’s Virtual Wallet with an OBR Best of the Web in our recap of the most important innovations of 2008 (OBR here).
4. For more on adding appropriate online financial management (OFM) features to your online banking offering, see our latest OBR published just yesterday: Online Financial Management 3.0.

Comments (1)

PNC Bank’s Online Application Process is Virtually Perfect

By Jim Bruene on May 4, 2010 6:44 PM | Comments (1)

image I've been a fan of PNC Bank's Virtual Wallet since it launched in 2008 (previous post here and here). The combined savings/checking functions, youth orientation, PFM features, and overall user experience are intriguing. I've sampled the demo, watched the videos and read about it for two years. But I've never owned the account to experience it from the end-user perspective.

Today, I finally opened one. While I still must wait 24-48 hours to view it online, I am pleased to report that the Andera-powered online account opening processed without a hitch. It took just 4 or 5 minutes, not counting digesting the 50+ pages of disclosures and account documentation which I saved but did not read.

I'll not go through the entire process here and instead save it for an upcoming Online Banking Report (also see note below). However, I did want to point out that the PNC has the best account-opening confirmation screen I've yet seen. Here are the key elements (see corresponding letters on screenshot below):

A. Thank-you message at the top, though it could be more distinctive. I missed it the first time I looked at the screen. After spending perhaps many hours researching account options, choosing PNC, and making a real deposit, users deserve a more enthusiastic response.

B. PNC account number (masked in the screenshot)

C. Confirmation number and a recap of the account name and deposit amount

D. Specific information on what happens next

E. A toll-free number and links to email for questions

Great work PNC and Andera.

Final screen in PNC Bank's Andera-powered online opening process (4 May 2010)

image 

Note: For more info on online account opening, see the report we published last summer.  

Comments (1)

PNC Bank's Virtual Wallet Offers Three Ways to Put Your Savings on Autopilot

By Jim Bruene on April 6, 2010 5:15 PM | Comments

imageIf PNC Bank's Virtual Wallet, launched in July 2008 (previous post), worked with any bank account instead of just PNC's, it would have hundreds of thousands of users instead of the 60,000 or so estimated by Compete.

From the outside it's hard to know whether the strategy has paid off for PNC. It depends on the profitability of these customers, how many were new to the bank, and how much was invested in the effort. 

imageThe Virtual Wallet contains several superb products wrapped in an inviting user interface.  No wonder it's won so many awards, including an OBR Best of the Web from us. The eight awards are shown in a scrollbar at the bottom of the homepage (see inset).

One thing the wallet does better than most is try to make savings less painful or even fun (see last week's post about making banking fun). There are three ways users can boost their savings rate (see inset from PNC's demo):

  • imageEstablish automated savings transfers at various times of the month
  • Set up a savings amount to be transferred every time a bill is paid (same concept as Bank of America's Keep the Change)
  • And my favorite, Punch the Pig. Every time you hit the animated pig, a certain amount of cash is transferred to the Growth (savings) account.


Note
: For more information on the PFM space, see our Online Banking Report on Personal Finance Features (new report available in April). For more on deposits, see Online Banking Report: Growing Your Deposits in the Digital Age (Dec. 2008).

Comments

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 <InOutCash.com> (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, YouAreACEO.com (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.

InOutCash.com homepage (22 March 2010)

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

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

Comments (7)

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)

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

Comments (4)

What the Real-Time Web Means for Banking

By Jim Bruene on March 1, 2010 2:31 PM | Comments (2)

imageOne of the most important trends in the online/mobile world is the so-called real-time Web. Here's how Wikipedia defines it:

...technologies and practices which enable users to receive information as soon as it's published, rather than requiring that they check a source periodically for updates.

Online banking should have gone real-time long ago, but privacy concerns and a legacy of batch processing -- not to mention the 100-year credit crisis -- have kept info delivery in very non-real-time at most financial institutions (note 1).

As balance/transaction email alerts appeared on the scene in 1996/1997, the perfect solution to keep consumers informed on a timely basis seemed assured. But for most users, financial alerts have not lived up to their promise. Why?

1. Users must remember to establish alerts while they are banking online

2. Users must establish proper parameters so they are not overwhelmed with alerts, or receive too little info

3. Those parameters must be tweaked as necessary

4. Users must select the proper email inbox(es) for the alerts

5. Users must read the alerts in a timely fashion

6. And of course, act on them if necessary

Frankly, that's just too much work for most online bankers. Sending alerts to a mobile device may help since it is typically more immediate than email. But that depends on the user and whether they really want banking messages in their text-message stream.

But we think many users, now accustomed to viewing a stream of info all day from Facebook, Twitter, FriendFeed, RSS, and so on, will want similar delivery of financial info. Some will want their financial info to stream into their overall news feed (e.g., via Facebook, Twitter, etc.), others will prefer a separate dedicated channel (e.g., Blippy note 2, Strings). And the old-school folk will still prefer email or text-message feeds.

Once the feed is established, users will want to interact with the data, for example:

  • Tagging entries for budgeting/tax purposes
  • Sharing specific transactions with friends, spouses, accountants
  • Forwarding transactions to bookkeeping or managers for reimbursement
  • Replying to the bank/merchant regarding incorrect transactions  
  • Flagging transactions for later review

The real-time Web turns online banking on its head. Creating a daily dialogue with customers, rather than one-time sessions where users log in every few days, then hope nothing goes wrong before their next login.

There are advantages in both models, but it's not really your choice which one to offer. The world has gone real-time: You can either join in or have your customers migrate to Mint/Blippy/Wesabe to tap their financial feed.

Notes:
1. This is characterization of the U.S. situation; many other countries are much further ahead, and have been operating under real-time info-flow for years. 
2. We believe there are a number of practical applications for Blippy's technology; see our previous post.
3. For more info on financial messaging and alerts, Online Banking Report subscribers should review our 2003 report on the subject.

Comments (2)

Twittering Vantage Credit Union Taps Geezeo for Online PFM

By Jim Bruene on February 26, 2010 5:42 PM | Comments (2)

imageLast October, Vantage Credit Union launched one of the most novel banking services of 2009 (or ever for that matter), transactional banking through Twitter direct messaging (see note 1). The CU earned our OBR Best of the Web designation for its creativity.

Unfortunately, it doesn't appear the service has gained much traction yet. The 103,000-member St. Louis, MO-based CU has 322 Twitter followers on its public feed and about 200 on its protected TweetMyMoney feed where the t-banking takes place (Note: Updated per comment). The majority of public feed followers are analysts, bloggers, and other credit unions.

But Vantage's Twitter move isn't about number of users. It's about keeping its brand relevant with its social networking members. And splashing Twitter across your homepage is a great way to do that (see screenshot below).

Now Vantage is back at it, partnering with Finovate-alum, Geezeo to offer state-of-the-art online personal financial management (press release). It will be fun to see what VCU EVP Eric Acree, a Filene i3 member, does with the Geezeo platform. I think it's safe to say that they will put a novel spin on PFM.   

VCU is Geezeo's fourth white-label credit union client; the other three are Stanford Federal Credit Union (previous post, note 1), Alliant Credit Union, and 1st Advantage FCU. The company is also working with 1st Mariner Bank (updated March 1 per comments).

Vantage CU continues to promote its Twitter features on its homepage
(26 Feb. 2010)

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Notes:
1. Stanford FCU's website still says Geezeo-powered MyMo is "coming soon" (link to the Oct. 31, 2009, dated announcement), but the link to the new service has been pulled from the SFCU homepage. 
2. For more info, see our Online Banking Report: Leveraging Twitter (May 2009)

Comments (2)

Mint.com Traffic Soars Under Intuit Ownership

By Jim Bruene on February 17, 2010 8:53 AM | Comments (4)

image I don't know if it has anything to do with the publicity Mint received in recent months following its acquisition by Intuit or the promotional links from Quicken's website, but the online PFM juggernaut just blew the roof off its monthly traffic. According to Compete, in January, Mint had 1.7 million unique visitors, 600,000 more than a year earlier.

To provide a little context, not counting the Dec. to April tax-time traffic spike at Intuit, Mint's traffic is now slightly HIGHER than that of its parent company (see chart #1 below). That gives you a little understanding of why Intuit coughed up $170 million for the startup.

Another way to look at it: Mint now has as much traffic as the tenth largest U.S. retail bank, BB&T (see chart #2).

The interesting question for 2010: Now that Mint is part of the establishment, what startup will rise up to challenge it? Or will the banks, back on a path to profitability, fill the need going forward? 

Chart 1: Mint's traffic is now similar to Intuit's non-tax-time traffic

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Source: Compete (link)

Chart 2: Mint now has about the same number of visitors as the tenth largest U.S. retail bank, BB&T
Note: Mint is blue line below

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Source: Compete (link)

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

Comments (4)

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.

Analysis
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)

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#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.

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#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).

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Notes:
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):

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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. 

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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:

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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

Features/benefits

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.

Analysis
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)

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

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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)

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

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Notes:
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)

Stanford Federal Credit Union Readies Launch of Geezeo-Powered MyMo PFM

By Jim Bruene on December 18, 2009 11:48 AM | Comments (1)

image It looks like we are just days away from the launch of the first Geezeo-powered private-branded online PFM. Fifty-thousand-member Stanford Federal Credit Union, one of the first financial institutions in the world to offer Internet banking in the mid-90s, has been promoting the soon-to-be-launched personal financial manager for several months.

The service, called MyMo is currently in final testing with SFCU employees. It will run both online (screenshot 1 and 2, below) and through a mobile app (inset).

imageMyMo has been the lead story in the CU's in-house newsletter for two months running (see screenshots 3 and 4). In November, the service was said to coming "this month." Then in December, it hedged with a "coming soon" message. There's still no specific info on when MyMo will launch, but there's a promotion running on the middle of the SFCU's homepage and Facebook page (see screenshots below), so it must be soon (note 1).  

The future: While private-branded online PFM is not new, Bank of America has several million users of its Yodlee-powered solution, the concept appears to be gaining momentum. Intuit/Digital Insight are now powering hundred of FIs while Wesabe and Jwaala have also made in-roads into the CU world. We'll see lots of innovation in this area in the coming decade (see note 2).

1. MyMo desktop: Dashboard view (link)

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2. MyMo desktop: Add a goal

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3. SFCU's November 2009 newsletter (link)

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4. SFCU's December 2009 newsletter (link)

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5. SFCU homepage (17 Dec. 2009)

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6. SFCU Facebook page (link)

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Notes:
1. While I think it makes sense to run a teaser campaign for a new product, SFCU should provide more detail on when the service will launch and why it's been delayed. Members want the service to be fully tested, so they won't mind waiting a bit longer as long as the CU is upfront with them about the timing.
2. For more information on the PFM space, see our Online Banking Report on Personal Finance Features.

Comments (1)

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)

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Note:
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)

Intuit's New Quicken Site Sprouts Some Mint

By Jim Bruene on December 10, 2009 10:30 AM | Comments

image If anyone still wondered how serious Intuit is about incorporating the Mint brand into its portfolio after its $170 million acquisition, take a look at the latest version of the Quicken sales site. Mint is prominently featured (see first screenshot below), especially if you scroll one "ad spot" over (second screenshot).

I also found Mint mentioned at PayTrust, Intuit's bill management site (third screenshot). There's even a small plug on the Quicken Online login page (fourth screenshot).

However, on Mint's site the co-branding is not reciprocated. Quicken is not mentioned at all and Intuit is relegated to 8-point type at the bottom of the page (fourth screenshot).

The latest traffic figures from Compete support the theory that Intuit is de-emphasizing Quicken Online in favor of Mint. Traffic to <quicken.intuit.com> fell 50% in November to about 400,000, while Mint held steady at about 3x that, 1.2 million unique visitors.

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Source: Compete, 10 Dec 2009 (link)

Quicken homepage on default choice, Quicken 2010 (link; 9 Dec. 2009, 11 PM)

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Quicken homepage with Mint.com selected from scrolling choices
Note: Yellow highlight is mine

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Intuit PayTrust homepage (link)

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Quicken Online login page (link)

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Mint homepage
Intuit mentioned twice at bottom of page (yellow highlight is mine). 

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

Comments

Chase Bank's Second iPhone App: Gift Planner

By Jim Bruene on November 24, 2009 7:02 PM | Comments (2)

imageA few days ago, we predicted there would be tens of thousands of financial institution iPhone apps as the big banks released dozens to support their major business lines. PNC Bank and Wells Fargo were the two examples we cited.

There's another multi-app bank: Chase. In our search for an iPhone gift planner to replace the web-based Zions Bank service, we ran discovered the bank's Gift Planner (iTunes link).

Version 1.0 was released in time for the holidays last year (3 Dec. 2008), but it looks like Chase didn't take over ownership/sponsorship until release 2.0 in August. The app is supported by an excellent small website at yourgiftplanner.com that displays the app and solicits feedback.

image The app and website are 100% Chase branded. The only indication that a third party is involved is a notation in the iTunes store that the app is sold by The Archer Group (inset), a Wilmington, DE-based digital agency.

Evidently, the app didn't show up on our radar because it's placed in the App Store Productivity category instead of Financial. The app doesn't appear to be mentioned on the Chase main website. A site search there came up blank.

Review: It's great looking app that can be used for any holiday. The app supports "shake for help," an advanced feature. The integration with your contact list makes it easy to add new contacts without typing, although you must wade through your entire list. And, the imageprocess of adding gifts is a bit tedious. You have to add a gift to the master gift list, then go to each person and add the gift to their profile. It would be better if you could simply type a gift on the fly.

iPhone users have been relatively unimpressed, giving the latest version a 2-star rating out of five; pretty low for a professional app (see inset).

It's a good branding tool for Chase, but it the app itself could use retooling.

Gift Planner iPhone screenshots (24 Nov 2009)

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Gift Planner website (link)

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Note: For more info on mobile banking on the iPhone see our March Online Banking Report.

Comments (2)

Zions Bank Replaces Holiday Gift Planner with eZ Budget Site

By Jim Bruene on November 23, 2009 6:07 PM | Comments

image Last year, I discovered a cool little web-based PFM app from Zions Bank, the Holiday Gift Planner (see previous post). It helps plan and track holiday gift lists and purchases (see second screenshot below).

I used it to track 2008 holiday purchases for our kids. I credit the app with not only keeping us on budget, but making the process a little less harried. I liked it so much, I awarded it with an OBR Best of the Web award. My only complaint: it should be an iPhone app.

But this weekend when I clicked my bookmark for the site to enter my son's "wish list", I received an error message, "site not found." I was afraid Zions had discontinued the service. After a search, I found that the site had been replaced by a similar, but more advanced PFM site, called Zions Bank eZ Budget (running on its own URL).

eZ Budget remains free and open to anyone, customers or non-customers. It still has the gift planner module which is very similar to last year's model (second screenshot). One addition: integrated links to the Zions website to see savings or financing options (see top-left in screenshot 2). And like last year, a Zions banner ad runs across the top.

But it's been expanded to have three other robust planning modules:

  • Monthly planner (screenshot 3)
  • Project planner (screenshot 4)
  • Event planner (screenshot 5)

Unlike last year when the gift planner was plugged on its homepage, there is no mention of the PFM module on the bank's website. However, eZ Budget is prominently mentioned on the bank's Facebook page (screenshot 6). And according to Compete, the new site has about double the traffic, 4,000 unique visitors, compared to 2,000 a year ago.

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Source: Compete, 23 Nov 2009

My take: This is a simple and cost-effective way to provide basic budgeting tools to bank customers. I wish Zions had also kept the standalone Holiday Gift Planner which had an attractive holiday look and was less daunting to begin using. But I can understand why the bank would not want to support two planning tools. More importantly, the iPhone version is still on my wish list. More on that tomorrow. 

1. Zions eZ Budget homepage (23 Nov 2009)

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2. Gift Planner module
Note: Default setting is "Christmas"; but can choose Birthday, Valentines, Wedding, Mother's day, Father's day, Hanukkah, or create your own.

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3. Monthly Planner module

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4. Project planner module
Note: Default setting is "home remodel"; but can choose landscaping, baby room, or create your own.

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5. Event planner module
Note: Default setting is "wedding"; but can choose birthday, vacation, or bridal shower or create your own.

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6. Zions Facebook page (link)
Note: Zions is giving away a $100 Best Buy card each month to new Facebook fans.

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

Comments

Bank of America's Launches Personal Finance Tips Site

By Jim Bruene on November 17, 2009 1:47 PM | Comments (2)

image Bank of America's latest online effort is a personal finance educational site at <learn.bankofamerica.com> that includes consumer polls, money savings tips, videos and articles. Bank products are sprinkled throughout but the marketing is relatively restrained.

It's a solid effort. Good, concise copy married to an attractive graphical layout. And for a bank the size of Bank of America, it makes perfect business sense. The site moves a little product, builds the brand, shows off the bank's consumer-friendly side, provides material for PR campaigns, and gains some CRA credit (note 1). 

But I'm not sure how much usage it will get other than the curious driven to it from banners within online banking. That's how ended up there today after paying my BofA credit card bill online (see second screenshot below).

Given Bank of America's 30 million online banking customers, they must not be driving much traffic to the site yet. According to Compete, traffic surpassed 100,000 for the first time in October. July was the first month that traffic was registered at the site.

Unique monthly visitors to BofA's personal finance tips site (July through October, 2009)

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Source: Compete

Other than enabling an RSS feed for article updates, the site has no Web 2.0 or social media features. No blog. No forum. It's just a very pretty face on personal finance 101 material. It will be interesting to see where they take it.

Learn.BankofAmerica.com homepage (link, 13 Nov. 2009)
Note: I completed the poll on the middle of the page, so the results are shown rather than the poll question.

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Logoff screen (13 Nov 2009, 3 PM Pacific)

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Note:
1. CRA = Community Reinvestment Act which requires banks to help meet the financial and credit needs of low- to-moderate-income consumers.

Comments (2)

The Missing Link for Small Businesses: Banking, Finance & CRM Dashboard

By Jim Bruene on October 28, 2009 5:12 PM | Comments

I finally finished our latest report on small business online banking last night. Just as I was about to upload it, I realized there was something missing in the "dream online banking solution" for small businesses.

So I stopped the "presses" and added it to the report. What was the missing piece? A financial and business management dashboard integrated with online banking.

I poked around the web today and found a few interesting products (see update below), none of which were quite what I was looking for, and had no direct connection to financial institutions:

  • image MyBizHomepage has a dashboard that integrates with QuickBooks and sounds pretty slick. But there website hasn't been updated for more than a year, so not sure if this is a viable business or just a hobby site. I have an inquiry in to the owner.
  • image DreamFactory Software also offers QuickBooks-integrated dashboards. I found it in the new Intuit App Center for QuickBooks add-ins (here). It's a powerful program, but not the kind of plug-and-play dashboard I'm looking for.
  • image iDashboards: Has impressive sample dashboards to view. None integrate directly with online banking, but many include financial data (see screenshot below).

So I'm still looking for financial institution examples. Know any? Comment below or email me. It's too late to make our report, but we'll report it here.

iDashboards mockup of a healthcare "billing scorecard" (link, 28 Oct 2009)

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Update (29 Oct 2009):

Here's another QuickBooks dashboard from QuickGauge.com:

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Comments

Intuit Offers Low-Cost Online Accounting via QuickBooks Free or Basic

By Jim Bruene on October 14, 2009 6:25 PM | Comments (1)

imageI was poking around the various small business online accounting sites today researching our next Online Banking Report and thinking about which service would suit our business, given that Microsoft is pulling the plug on Money.

I was already familiar with Outright.com (a Finovate 2009 presenter; demo video coming soon), FreshBooks, and LessAccounting. But I was completely surprised by one contender in the free category: Intuit QuickBooks Online.

The software giant offers three flavors of online-only accounting (see screenshot below; full comparison here):

  • QuickBooks Online Free: Create and send invoices, print checks, track money flow for up to 20 customers and run basic reports; even includes email support
  • QuickBooks Online Basic: In addition to the above, for $9.95/mo, users can manage an unlimited number of customers, set permissions for others to access data, and choose from a library of 40 standard reports
  • QuickBooks Online Plus: Full-fledged QuickBooks for $34.95/mo, mimics most features of QuickBooks Pro (see comparison here)

Financial institution opportunities:
All four online accounting companies offer free versions and premium fee-based options (note 1). Consider linking to them from your small business resource center. For extra credit, develop a co-branded version you can offer your customers or negotiate discounts for the fee-based versions.

Intuit's QuickBooks Online product line (14 Oct 2009)

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Notes:
1. Outright.com is currently free for all users, but says it is working on value-added, fee-based options.
2. For more info on the small biz space, see our Online Banking Report: Small & Microbusiness Banking (June 2004). Note: Anyone who purchases the 2004 version now, will automatically receive the newer version when it's published later this month.

Comments (1)

Is Mint Worth $170 Million?

By Jim Bruene on September 14, 2009 4:24 PM | Comments (2)

image The rumors broke yesterday and the confirmation came today. Intuit is buying two-time Finovate Best of Show winner, Mint for $170 million (see note 1). Few people are surprised by this move or the price. Mint's latest VC investors had just invested at a $140 million valuation a few weeks ago, so $170 mil is in line with that. It's also a 5x return to the total VC investment of $32 million, so everyone associated with Mint has to be pretty happy, especially in an environment where most assets have fallen by double digits in the past two years.

image The bigger question is whether the startup is worth $170 million? To Intuit, I think the answer is definitely yes (see below).

Intuit shareholders were indifferent with no real movement in share price today (see inset) on lower-than-normal trading volume (note 2). Because of the deal, Intuit lowered per-share net income estimates by 2 cents ($6.5 million loss) for FY 2010, and says there will be no material impact after that.

Apparently, Intuit will keep the Mint brand, at least for now. Mint CEO Aaron Patzer will be general manager of Intuit's personal finance products, both online AND desktop.

I'm no M&A expert, but here's why $170 million sounds reasonable to me:

  • At Intuit's current multiple (20x), Mint needs to generate approximately $10 million in annual profits to break even for shareholders. With 1+ million users at Mint, that's $10 per user per year, less than a buck a month.
  • While Mint isn't likely making that type of profit today, the combination of lower costs from Intuit back-end systems and additional revenues from upselling Intuit services (TurboTax, Cuckoos, and others), should elevate Mint to a $10 million-plus business unit relatively quickly.
  • Intuit needs an entree to the young-and-frugal segment, and Mint can be the starting point with users migrating to Quicken Online (which can be returned to a fee-based, advertising-free service), TurboTax, and/or QuickBooks over time.
  • Plus there's a bunch of intangibles that are difficult to quantify until you see how Intuit handles the Mint.com user base. Even though there's the usual grousing from Mint users today, in reality, Intuit's trustworthy brand name should be able to retain current users and grow the base.

Here's how I break down the purchase price:

$5 to $10 mil >>> Assets: Code, IP, employees, etc.
$10 to $20 mil >> Brand: Name, URL, traffic, awards, etc.
$100+ mil >>>>> Customers (1,000,000 at $100 each)
$25 to $50 mil >> Option value

Notes:
1. Mint won the audience voting for Best of Show at both our 2007 and 2008 Finovate conferences. If you want to see and meet the next Mint, we have a few dozen tickets left for Finovate 2009 on 29 Sep (purchase tickets here).
2. Last week, shares fell $0.40 or 1.4%.

Comments (2)

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

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Cashflow INSITE homepage (21 Aug 2009)

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PocketSmith homepage (21 Aug 2009)

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Notes:
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)

Microsoft to discontinue selling Microsoft Money immediately, end online service in two years

By Jim Bruene on June 10, 2009 5:14 PM | Comments (1)

imageMicrosoft will stop selling its Microsoft Money packaged personal finance management (PFM) software at the end of this month (FAQ here). Online services will expire Jan. 31, 2011, or earlier depending on when users activated their program.

The company will continue its online-only account management and bill pay services at MSN Money. Banks supporting direct downloads to the program, such as US Bank and Wells Fargo, will have to migrate users to other options, most likely Intuit's Quicken.

For me, it's an end of an era. The main reason I became involved in the online banking industry was to participate in a four-bank group that worked with Microsoft to add online banking and bill pay to Microsoft Money 3.0 (note 1), released in Feb. 1994 (see inset). It was an industry milestone and a major coup for the company at the time, bringing online banking to its PFM more than two years ahead of Quicken. 

So, after 15 years of using the program, I'll finally have to make the long overdue move to QuickBooks to manage our company finances. But to be safe, I'm going with QuickBooks online, which I'm guessing will not become obsolete in my lifetime.

Microsoft Money Plus page announces the end of the line (link, 9 June 2009)

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Notes:
1. According to Wikipedia, Microsoft Money is currently on version 17.

Comments (1)

LowerMyAssessment.com 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 LowerMyAssessment.com (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).  

Analysis
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)

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

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

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

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Notes:
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)

Fallout from Rudder's mishap, will it impact all third-party PFM apps?

By Jim Bruene on May 20, 2009 7:27 PM | Comments (7)

imageYesterday, Rudder suffered an embarrassing email glitch that affected 732 customers. In the pre-Internet days, no one other than those few hundred customers, and a few of their friends, would have heard about it. Even in the days before blogs became common, pre-2007, it's unlikely the story would have made it to the mainstream press.

And even last year, before Twitter, the story might have died without ever crossing over to the mass media. But when it comes to breaking news and company gaffes, it's a whole new ball game. Everyone wants 15 minutes of fame as an investigative reporter, and Twitter is the dream platform.

I'm going to recap the problem, and how the news broke, in excruciating detail, because it illustrates the power of Twitter- and blog-fueled grassroots reporting. If you are a financial services company, think about how you could use social media to help with damage control should something similar happen to you.  

What happened at Rudder
According to the detailed description first published in TechCrunch and then later published by the company on a new blog created specifically for this issue, an email upgrade the night of May 18 caused 732 users to receive dozens of email updates containing balance and transaction information of other users. Only Rudder users with email addresses that begin with "a" or "b" received the erroneous emails because the company stopped the email job at that point after realizing the "upgrade" had gone terribly wrong.

Besides seeing the info in the email updates, the bigger security/privacy problem was that unauthorized users were able to click through email links to access the full aggregated account at Rudder.com (see screenshot in the TechCrunch article). However, at no time could anyone actually log in to anyone's bank account or move money in any way.

Luckily, Rudder, like all account-aggregation companies, does not include account numbers or personal details in the updates. However, the email addresses of each user was displayed, so any of the 732 customers using an email address at Rudder that can be traced back to their real name, had their financial details exposed to hundreds of users. 

How the news broke
At 5:36 AM yesterday (19 May), Twitter user @adambassador tweeted this:

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And @adambassador didn't stop at that. He took the time to search and communicate warnings directly to several other users who'd recently mentioned "Rudder.com" on Twitter. Adambassador would go on to tweet 21 times yesterday about the Rudder problem.

One of the people who heard from @adambassador was financial services consultant and blogger, Mike Linskey (@mikelinskey) who'd just Tweeted about several of the PFM companies he'd seen at our FinovateStartup conference, including Rudder.com. Mike then posted the problem to his Fincision blog at 8:04 AM, and at Mike's request, adambassador posted screenshots of the emails to document the problem, which were then published in Mike's blog entry.

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At 10:05 AM, using Twitter, Mike alerted the blog Mashable about the Rudder problem. A half-hour later, Mashable, the fifth largest blog in the country (see note 1), posted the story citing adambassador's tweets and Mike's blog entry. From the Mashable blog entry (below), the problem was retweeted 115 times (see the retweet button below on left).

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Then at noon, the second largest blog, TechCrunch, with more than 2 million subscribers, posted the story. And because of high comment activity, it stayed on the top of TechCrunch most of the day (see screenshot below), generating 58 comments.

How Rudder handled it
By almost any standard, Rudder did a good job responding. Although their reply took more than 10 hours since the error was first reported on Twitter, Rudder's CEO posted a detailed comment on the TechCrunch (scroll down to his comment at 4:38 PM here) and Mashable posts, apologizing for the error and explaining in great detail what had happened. 

In addition, Rudder created a special "Rudder Update" blog (see screenshot below) apologizing, explaining the mishap and exactly what info was mistakenly displayed, and detailing the steps they were taking to fix the problem and help affected customers:

  • Turned off the email system entirely
  • Contacted each affected user individually and offered them a complimentary subscription to an identity theft service
  • Engaged an independent security auditor to survey its system and look for weaknesses
  • Published a URL for users to go in and delete their accounts if desired

Analysis
Rudder did a good job considering the situation. It was smart to comment on TechCrunch and Mashable, and the new damage-control blog site was a savvy move. And the company did an exceptionally good job with the tone and wording of its mea culpa.

That said, the company could have used social media better. The company's Twitter page (@userudder) and that of its CEO (@nikhilroy) were silent all day. A short Twitter posting, even "we've stopped all emails and are working on it" would have reassured users and potentially made the Mashable post less alarming. Also, the company didn't have a blog, so there was no place where they could post periodic updates during the day. It was complete silence for 11 hours, other than the interview with TechCrunch's Erick Schonfeld mid-day.

Impact on third-party PFM credibility
While this was embarrassing and violated the privacy of several hundred users, there will likely be no financial loss to anyone. There was no data breach or stolen account numbers. Even a single bank account statement stolen from a mailbox could cause more potential financial damage.

And even though third-party PFM providers have had a relatively spotless record for security/privacy, this mistake, now well-documented in two of the largest online publications in the world, will be cited in the media for years, to cast doubt on the security of online personal finance.

It might cost the industry a point or two in short-term market share, but it would take something much worse to materially slow growth. Even Rudder should be fine. By addressing the issue in a highly professional way on the same day, most customers will be reassured, at least those that weren't directly impacted.

The bigger lesson here is the need for damage-control procedures that take into account the power and speed of new media (note 3). The entire episode could have--prior to Twitter and the blogosphere--been known to just a few hundred customers of a very small company, but instead traveled from a lone tweet to a large splash across the homepage of a major publication, all within a 6-hour period.     

TechCrunch featured the Rudder post on its main page most of the afternoon (19 May 2009)

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Special damage control blog created by Rudder yesterday
(19 May 2009; link)

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Note:
1. Ranking by Technorati authority (here)
2. Thanks to Mike Linskey for the tip yesterday morning.
3. Also, account aggregation users should use an email address that is not directly associated with their name.

Comments (7)

Intuit's Quicken Online Releases Native iPhone App

By Jim Bruene on May 2, 2009 9:22 AM | Comments (1)

imageYesterday, Intuit launched its first native app for the iPhone, Quicken Online Mobile. It's already risen to number four in the Finance category (note 1), and will likely hit number one given the number of Intuit fans using the iPhone. Currently, E*Trade's new Mobile Pro claims the top spot.

imageIntuit has incorporated some interesting features including this user-friendly "what's left until payday" feature. Users can access a graphical map of their future balance level (below) and get a warning (right) if the account looks like it will run out before the next payday.

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image Intuit also uses the GPS/location-based capabilities of the iPhone with a built-in ATM finder (click on inset for larger view). And finally, users are able to input transactions on the fly to get a real-time look at the impact to their budgets on the latest expenses.

The two-minute YouTube video (link) is worth watching to see how to position your iPhone PFM as a mobile financial assistant (speaker is Intuit product manager, Barron Ernst):

There are a number of personal finance apps available on the iPhone platform including Mint, Wesabe (announced Tuesday at FinovateStartup), MoneyTrackin, iBearSoft Software, and dozens more. 

Notes:
1. Quicken's mobile app is number four in the free apps section of the iTunes Finance apps section as of 8:30 AM Pacific time, 2 May 2009. It has 73 user reviews with an average 4-star rating (excellent). In comparison, Mint which launched its iPhone app in December has nearly 13,000 reviews.
2. According to VentureBeat, Quicken Online passed the 1-million user mark in mid-April.

Comments (1)

Apple iPhone Print Advertisements Feature Personal Finance Apps

By Jim Bruene on April 16, 2009 5:06 PM | Comments

image_thumb8Apple must be one of the more lucrative advertisers these days at the Wall Street Journal. Apple has bought the back page more times than I can count to show off the iPhone and more-importantly, the diversity of applications available (see inset, note 1).

Lately, Apple has run "theme" ads showing applications related to a single category. Last week (Thurs, 9 April), the back of the A section showed personal finance apps (see left column below). Yesterday, the apps all supported small business and ran on the back of Marketplace (B) section (see right column below).

The only app to make both lists: personal finance superstar, Mint, which even scored top billing in the personal finance page, occupying the upper-left corner, where it's blurb would likely score the highest readership. 

The Apple website also has themed app guides. The managing money page (see screenshot below) features again features Mint, which gets the biggest graphic, Bank of America, who's app was featured in dozens of Apple ads in 2008 and earlier this year, Bloomberg, Gas Cubby, iXpenseIt, Save Benjis, and Home Finder.

Bottom line: Financial institutions should think about how to add similar money management functionality to their mobile and online offers. As Aite's Ron Shevlin pointed out in a comment here last week (emphasis added):

.....(the FinovateStartup participants) you talk about are helping people manage their financial lives, while the banks are [still] focused on helping people manage their financial accounts.

Big difference.

Table: iPhone apps listed in recent WSJ ads (clockwise from upper left)

Personal Finance Theme Small Business Theme
Helping you stretch your budget, one app at a time. Helping you run your small business, one app at a time.
Date: 9 April 2009 Date: 15 April 2009
Mint.com (PFM) Credit card terminal
Gas Cubby (mileage tracker) Print & share (document management)
Spotasaurus (parking finder) FedEx Mobile
RepairPal (mechanic finder) Jott (voice recording/transcription)
AllRecipes.com (recipe finder) iXpenseIt (expense report mgmt)
GoodGuide (product finder) Jobs - Time Tracking
WootWatch (cheap gadgets) Analytics App (website analytics)
Save Benjis (shopping comparison) LinkedIn
RN Dining (rewards dining) LogMeIn (remote computer access)
Find an Apartment YellowPages.com
Cellfire (mobile coupons) Mint.com
Barista (how to guide) Quicksheet (spreadsheet)
Wi-Fi finder Air Sharing (file manager)
CompareMe (price calculator) Nomina (name/trademark search)
Loan Shark (loan tool) SimpleMind Xpress (brainstorming)
Small Spend (mini PFM) Keynote Remote (presentation tool)

Apple's Money Management page on its Website (link, 16 Apr 2009)

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Notes:
1. My apologies for the image quality, taken via iPhone naturally.
2. For more info, see our latest Online Banking Report: Mobile Banking via iPhone.

Comments

Xpenser Masters Mobile Expense Input

By Jim Bruene on March 31, 2009 4:06 PM | Comments (1)

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Launched in Oct. 2007, Xpenser (see note 1) is a financial tool designed for tracking items for business expense reports. Monthly traffic is about 6,000 unique visitors according to Compete.

To understand Xpenser, visualize how Mint works, then think of the opposite.

  • Mint is full automated; Xpenser is all one-off data entry.
  • Mint has graphics that will blow you away; Xpenser has lists.
  • Mint requires you to divulge your banking usernames and passwords; Xpenser just needs your email address.
  • With Mint, you can track your bank accounts, investment accounts and net worth; Xpenser only helps you submit your next expense report.

Xpenser's mission from its website:

We were fed up with how painful expense reports and tracking were. After many experiments we found a workable solution: record expenses as soon as they happen and forget about them.

How it works
image After a registration process that requires no more than your email address, you can begin immediately submitting expenses to the service via:

  • Email by sending a message to e@xpenser.com with the free-form expense listed in the subject line
  • iPhone optimized site (see inset); it's not in the App Store, but you can add an Xpenser button to your iPhone by navigating to the Xpenser website and pressing the + button
  • SMS by sending a text message to 66937 (MOZES), using "exp" followed by the free-form expense description
  • Voice via Jott or Dial2Do (both free services)
  • Twitter via direct message from your registered Twitter account
  • IM via Yahoo Messenger, AOL Messenger, MSN Messenger, or Google Talk
  • Browser search box in Firefox or IE 7+ (see below)
  • Secure website via standard input form

Once the expenses are collected, users go online and move each expense to the appropriate report. Transaction amounts and descriptions can be edited.

The company is building open APIs, so developers, including banks, can use the service to kick-start their own personal finance tools. The company says it will build premium fee-based versions with long-term archives along with other features.

Xpenser competes directly with Expensify (see note 2), a company that will be demo'ing at our upcoming FinovateStartup conference.

Data entry via the browser search box
Although, it's not a core piece of the program, I was perplexed when I saw that one of the methods of entering expense data into your Xpenser account was through the "search box." That was probably what convinced me to sign up for the account.

Here's how it works in Firefox (also works in IE 7+ and any browser that supports OpenSearch):

  • Navigate to the Xpenser website
  • Click on the drop-down area next to the browser search box
  • Add Xpenser as a "search engine"
  • Then simply type the expense amount and description in the search box making sure that Xpenser is the selected as search engine (see second screenshot below), and press enter; Xpenser recognizes your account through cookies and adds the "search term" to your data file

That feature is so clever, it's almost creepy. I'm not sure a bank would want to use this feature since it could capture any search term the user inadvertently input while the bank's "search engine" was selected in the browser search box. 

Xpenser main account page (30 March 2009)

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Input via the browser search box (30 March 2009)

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Notes:
1. Not to be confused with FinovateStartup alum, Expensr, now part of Strands.

2. Expensify has abandoned the decoupled debit business model it was using when we wrote about it's launch last fall (previous post).  It now offers the choice of a prepaid MasterCard or an American Express-issued card.

3. For more information, see our Online Banking Report on Personal Finance Features for Online Banking and our Online Banking Report on Social Personal Finance

Comments (1)

Wesabe to Power Bank and Credit Union Personal Finance Communities with White-label Deals

By Jim Bruene on March 18, 2009 7:30 PM | Comments (4)

image Today, Wesabe (company blog post) joined Geezeo (press release) in officially pursuing a strategy of white-labeling its personal finance services for banks and credit unions (note 1). Wesabe CEO Marc Hedlund told me they have three deals in various stages of the contract process, but none have signed on the dotted line yet.

You can get an idea of how this will play out by visiting Wesabe's first co-branded site at the UK's Daily Telegraph (see screenshot below). However, in the banking rollout, the service can truly be white labeled with no mention of the Wesabe name. Wesabe provided a mockup of its white-label product for the fictitious Springboard Bank (see second screenshot below).

As much as I love online PFM sites, the future for most financial management activity is within the confines of online banking sites (note 2). Why? Most people do NOT enjoy tagging purchases, tracking their budget, monitoring their net worth in real-time, or debating the latte factor.

Banking, like most chores, needs to be accomplished as efficiently as possible. And the easiest way to track financial activity is at the place the customer already knows, trusts, and uses, their online banking site (note 3). 

That doesn't mean there isn't a place for Mint, Quicken and other PFM sites. Millions of consumers and small businesses pay close attention to every transaction. And they'll invest time, and money, into standalone sites that offer state-of-the art tools and independent perspectives.    

But by partnering with full-featured PFMs like Wesabe, banks and credit unions give customers little reason to look elsewhere. Wesabe is particularly well-suited for the role of financial institution service provider (note 4):

  • Technology: It owns the aggregation engine, so they have more flexibility in pricing and contract negotiations
  • API: Wesabe has featured a public API since 2007, so it's easier for bank developers to hook into its rich dataset
  • Features: Has state-of-the-art user interface including a Twitter interface, widgets for Mac and Windows Vista, an iPhone-optimized site, and soon an iPhone app
  • Brand: It has taken the high road....positioning the Wesabe brand as an unbiased financial guide; in fact, they've never taken advertising or commissions from financial providers
  • Experience: Launching in 2006, they have been around longer than most other players, giving them credibility and a better longitudinal database
  • Traffic: Of independent PFM sites (see Jan. traffic here), Wesabe trails only Mint and Geezeo in monthly traffic (120,000 unique visitors in Feb according to Compete), so it brings an established community and financial database to their financial institution clients

Make vs. buy
For a financial institution, the advantage of working with Wesabe vs. building PFM capabilities in-house include:

  • Speed to market: Outsourcing allows FIs to get the PFM features in to the market much faster; depending on level of integration, could launch in a few months
  • Integration: Although young, Wesabe is an experienced aggregator and technology company; this expertise can be tapped to provide integrate bill payment and funds transfer capabilities
  • Existing community: FIs can leverage the vibrant Wesabe community to instantly provide interesting content and community
  • Cost savings: Gives the financial institution state-of-the-art features much faster, and usually at a lower cost, than building them in-house

Wesabe's co-branded site at UK's Daily Telegraph (link) (18 March 2009)

image

Wesabe mock-up of white-labeled PFM interface (18 March 2009)

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Notes:
1. Wesabe's new service is called Springboard and Geezeo's is Spectrum.
2. Assuming banks and credit unions offer a reasonable set of personal finance management tools.
3. For more info, see our Online Banking Report on Personal Finance Features for Online Banking and Online Banking Report on Social Personal Finance.
4. Geezeo also boasts similar benefits; while it's a year younger and doesn't own the aggregation engine, its provider, CashEdge is already used and trusted by many large financial institutions, and Geezeo boasts higher traffic than Wesabe. 
5. Come talk to Wesabe's execs at our FinovateStartup 2009 conference, April 28 in San Francisco.

Comments (4)

Will the Online Personal Finance Specialists Survive?

By Jim Bruene on March 5, 2009 7:19 PM | Comments (2)

image I love personal financial management websites. Not so much for the reality, actually I hate tracking expenses, but for the promise. The illusion of having everything under control, never overdrafting, never missing a payment, and with perfectly-shaded multi-color pie charts just a click away (inset from Mint). 

But I've always thought that once banks and credit unions added basic PFM functions to their online banking services (see note 1), it's game-over for most independent PFM sites. They would have to either license their platform to financial institutions, sell out, or close their doors.

Now I'm not so sure.

Mint did something recently that made me reconsider. It was really pretty simple when you think about it. Yet as far as I know, no bank, card issuer, or even credit union has ever taken this on. 

The Mountain View, CA-based startup scanned their members' credit card statements to identify bogus charges from a known scam. And the company plans to make the resulting fraud alert service a standard part of its offering.  

From American Banker (23 Jan 2009):

Mint Software Inc. is planning to roll out a tool that will automatically scan its 800,000 users' accounts for potentially bogus charges....Aaron Patzer, Mint's founder and chief executive, said the idea for the new product came after his company heard of a scam involving Adele Services of Melville, N.Y., a bogus merchant that was making 25-cent charges to millions of consumer accounts. The news was widely reported, and Mint decided to check its users' accounts its to see if any had been affected; it found 800 that were.

Score 1 for the upstarts.

Bottom line: If the online PFM purveyors harness technology to take better care of banking customers than the banks themselves, especially with practical, money-saving ways such as Wesabe's Cutback Tool (below), the newcomers have a bright future indeed.

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Note: For more info, see our Online Banking Report on Personal Finance Features for Online Banking.

Comments (2)

Mint, Quicken Online Release Registered-User Totals

By Jim Bruene on February 20, 2009 8:26 PM | Comments (1)

mint_logoWe've regularly cited third-party estimates of website traffic to Mint and other PFMs. More often that not, we'll get a comment or email taking us to task for using such inexact and/or irrelevant data. But we believe that website traffic, even a rough approximation, is a leading indicator of success.  image

Luckily, we now have better metrics for the two online leaders. In response to what appears to be a truth-in-advertising query from Intuit's general counsel (see note 1), Mint disclosed its registered-user count (note 2), which has been growing at an average of 17% per month in Q4 2008 and so far in this year. 

As of yesterday, Mint had 934,000 users, double third quarter's end-count. That's 3,400 new registered users per day (seven days a week), almost 25,000 per week. The company should pass one million before St. Patrick's day.

While this growth in registered users is impressive, what's truly astonishing is that 70% of the registered users, 680,000 so far, have entered at least one bank or credit card username/password in order to automatically download transactions into Mint.

In response to Mint's disclosure, Quicken Online reported its 650,000 registered users, currently growing at a 45,000-per-week clip. If that continues, they'll pass one million before the April tax deadline.

It looks like there's quite a battle shaping up between the two leading online personal finance specialists. And don't overlook the banks. Both Bank of America (2.5 mil as of April 2008) and Wells Fargo (1 mil as of Nov 2008) have more online personal finance users at this point.

What it means: Account aggregation, left for dead a few years ago, is making a fearsome comeback. The three biggest players, Bank of America, Mint, and Quicken Online, now have more than 4 million registered users, approximately 4% of all U.S. banking households (note 3).

Table: Mint Registered Users by Month

Month-End Registered Users* Monthly
Gain
Month/Month
% Gain
Aug 2008 404,000 -- --
Sep 2008 458,000 54,000 13%
Oct 2008 544,000 96,000 21%
Nov 2008 606,000 62,000 11%
Dec 2008 720,000 114,000 19%
Jan 2009** 864,000** 144,000** 20%**
Feb 2009*** 934,000*** --- ---
Avg gain/mo -- 94,000 17%

Source: Mint, Feb. 2009
*Registered users are anyone who has signed up with email address
** Through Jan 25 (per Mint letter, 28 Jan)
***Through Feb 19 (per
TechCrunch post, 19 Feb)

Notes:
1. Intuit's letter to Mint here.
2. Mint's response here.
3. Yodlee provides the aggregation engine for both Bank of America and Mint.
4. For more info, see our Online Banking Report on Account Aggregation and Online Banking Report on Personal Finance Features

Comments (1)

Online Personal Finance Traffic Soars; Mint Passes One Million Unique Visitors

By Jim Bruene on February 9, 2009 8:52 PM | Comments (2)

imageJanuary is always a great month for personal finance. Consumers working off holiday spending binges and/or attempting to live up to New Years resolutions naturally find their way to personal financial management sites. It's especially pronounced this year as consumers try to better understand their spending and manage for the downturn.

So it's not surprising to see that traffic grew by 300,000 unique visitors in January (+20%) compared to December. Total traffic was up 4.5-fold at sites open for a year or more (see Table 1). Including the class of 2008, total traffic was 2.0 million, a five-fold increase from a year ago.

Highlights:

  • Mint had another great month, increasing site visitors by about 200,000, a five-fold increase in the past year. Mint's gain in January was more than that total traffic of all nine 2008 newcomers combined. Mint had a 60% market share of the total of 1.8 million visitors in the category, about the same as December.  image
  • Geezeo continued its wicked pace, growing 30% during the month, and posting a 12-fold increase over a year ago.
  • Quicken Online, which launched in January 2008, more than doubled visitors to 150,000 compared to December. However, traffic at Quicken is hard to compare to other sites due to the massive traffic at its parent site: for example, <quicken.intuit.com> received 1.2 million visitors and <intuit.com> website had more than 10 million. 
  • image Wesabe was the only site, of those open for a year or more, that turned in a traffic decline, falling more than 30% in the month. However, keep in mind the Compete estimates are derived from an online panel and are not always accurate, especially for sites in the low six-figures or less. The company said that it had record page views in January. That includes both U.S. traffic, measured by Compete, and international visitors.
  • BudgetTracker also turned in amazing results, nearly doubling its traffic to an imageestimated 27,000 visitors.
  • Of the 2008 startups (see Table 2), Thrive was the only one showing strong growth, increasing 50% over the previous month. On Friday the company was acquired by Lending Tree for an undisclosed amount.

Table 1: Traffic at online PFMs launched more than one year ago

  Jan 2009 Dec 2008 Jan 2008 YOY Chg
Mint 1.1 mil 890,000 200,000 5.2x
Geezeo 220,000 170,000 18,000 12x
Yodlee 120,000 100,000 84,000 44%
Finicity/Mvelopes 100,000 71,000 91,000 10%
Wesabe 89,000 140,000 56,000 60%
BudgetTracker 27,000 14,000 15,000 86%
Buxfer 22,000 15,000 13,000 78%
PearBudget 12,000 7,600 4,200 3x
ClearCheckbook
BudgetPulse
11,000
8,200
9,100
4,300
4,600
2,200
2.3x
3.6x
Total 1.7 mil 1.4 mil 490,000 4.5x

Table 2: Traffic at the online PFM class of 2008

  Jan 2009 Dec 2008 Month Chg
Quicken Online 150,000 53,000 1.8x
PNC Virtual Wallet 41,000 45,000 (9%)
Rudder 39,000 61,000 (35%)
Thrive 21,000 14,000 52%
Scred 2,600 630 4x
Expensr 2,500 3,700 (32%)
RateSurfer 2,100 3,600 (41%)
Expensify 1,400 600 2.5x
Banzai 1,300 1,500 (15%)
GreenSherpa 400 ina --
iThryv 210 2,100 (90%)
Total 260,000 185,000 41%

Source: Compete, 7 Feb. 2009; estimates of monthly unique visitors from the United States

*The percent changes were calculated from the underlying data set and due to rounding of the monthly traffic figures; the percentages may look slightly off

Note: For more information on the market, see our Online Banking Report on Personal Finance Features and Online Banking Report on Social Personal Finance.

Comments (2)

Best of the Web: Zions Bank's Holiday Gift Planner Wraps Personal Finance into a Neat Package

By Jim Bruene on November 28, 2008 2:40 PM | Comments (1)

imageAs I was publishing my earlier post on the Thanksgiving message on the Zions Bank homepage, I noticed a small Holiday Gift Planner banner in the lower left corner (see inset below). Expecting to find a pitch for Visa or MasterCard gift cards, I clicked on it and was surprised to find a very cool holiday microsite called at MyHolidayGiftPlanners.com (see screenshot 1 below and note 1).

imageThe gift planner is a personal financial management tool for planning, budgeting, and tracking holiday gift expenditures. Users create a gift list for each person by entering a budget amount per person, an estimated cost for each planned gift, and then later the actual amount spent.

The tool does all the math, tracking progress against each recipients' gift list and how the total holiday budget is faring (see screenshot 2). It even includes a space for capturing gift-buying notes (see below). This year's list will be archived to provide a handy reference for next year. Hopefully, the bank will use email to draw users back next year.

image

Consumers could do the same thing on a spreadsheet or within most personal finance programs. However, Zions has built an elegant solution that is faster and more convenient. I've always done this for my kids on a piece of paper which I inevitably lose and/or leave out on the table where anyone can read it. I look forward to keeping this list bookmarked and password-protected on my computer this year. 

Anyone can use the program, you needn't be a Zions customers. It takes seconds to sign up inputting name, email address and password (see screenshot 3). The site gently cross sells credit cards to pay for itself. There's a banner that runs across the top of the planning page (screenshot 2) and a link to special cardholder discounts on the main page (screenshot 4).

Zions should turn the planner into an iPhone/Android app to help users track gift purchases on the go and avoid the need to print the list prior to the trip to the mall.

obr_bestofweb Bottom line: The Zions gift planner is a great example of how to creatively use branded financial management tools to both help customers and create synergy with banking products. We're giving Zions our sixth OBR Best of the Web 2008 award for creating a simple solution to help customers avoid holiday overspending, a pesky personal finance issue that is top-of-mind this year. 

 

1. Homepage of Zions Bank's gift planner (28 Nov 2008)

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2. A credit card cross sell runs across the top of my personalized gift planner

image

3. Email address is captured for future marketing purposes

image

4. Credit card discounts are displayed along with an credit card application

image

Note:

1. Evidently the planner was available in early December last year. The first blog mention was 7 Dec 2007.

Comments (1)

Wells Fargo is Second Online Personal Finance Provider to Join the 1-million Club

By Jim Bruene on November 17, 2008 10:34 PM | Comments

imageIn April, we reported on the robust adoption of Bank of America's online personal finance manager, My Portfolio (see note 1), used by 10% of the bank's 25 million online bankers. The results are especially impressive given that it's a full-featured module accessible via online banking, but not particularly well integrated.

imageIn comparison, Wells Fargo offers a completely integrated PFM tool, My Spending Report, that's extremely simple to use, but offers limited functionality. On Oct. 29, the bank made an important improvement, adding a basic budgeting tool, Budget Watch, to what had been essentially a list of transactions divided by category.

The bank told me last week they have 1 million monthly users, making it the second online PFM provider to break the 1-million mark (after BofA). Wells has about 15% of its online banking base (note 2) using the tool, a slightly higher penetration than BofA. Again, not surprising considering how well it is integrated. The budget tools should boost penetration.

Who'll be the next one to join the 1-million club? Mint, with about 500,000 users in its first 15 months in business, is headed that way, possibly as early as late next year.  Chase/WaMu could get there in a few weeks, if they added online personal finance to their feature set. Quicken Online, now that it's free, should get there relatively quickly as well.

Note:
1. BofA's My Portfolio is powered by Yodlee.

2. Excluding Wachovia accounts.

Comments

Online Personal Finance Traffic More than Doubles; PNC Virtual Wallet Grabs Second Place

By Jim Bruene on October 23, 2008 6:53 PM | Comments (3)

image As I was drilling into the latest Compete traffic numbers for the annual Online Banking Report planning issue, I noticed a significant uptick in traffic to online personal finance specialists, almost across the board.

Sept. traffic revealed a total of 1.2 million unique visitors (note 1) compared to less than 400,000 a year ago. Not surprisingly, consumers appear to be taking a closer look at their finances. 

The big three newcomers last year: Mint, Wesabe, and Geezeo saw combined traffic increase by 450,000 users, a nearly three-fold increase from 2007. Geezeo was the star percentage-wise, growing more than six-fold. But Mint accounted for three-fourths of the net gain across the existing players with 330,000 more visitors (see Table 1 below):

Also, two newcomers made a big splash last month:

  • PNC Virtual Wallet launched in July (coverage here) by PNC Bank, which trailed only Mint last month with nearly 140,000 unique visitors (see 2 below).
  • Rudder (a relaunch of Spendview) drew 50,000 visitors last month after its launch at DEMOfall in early Sept.

Granted, the PNC Virtual Wallet benefits enormously from the 2 million monthly visitors to parent PNC.com and PNCBank.com. Yet, it's still an impressive total and is encouraging for banks and credit unions considering similar efforts.

Table 1: Online PFMs launched more than 1 year ago

  Sep 2008 Sep 2007 Gain '08 vs. '07 Multiple
Mint 530,000 200,000 330,000 2.7 x
Geezeo 72,000 11,000 61,000 6.5 x
Wesabe 89,000 33,000 56,000 2.7 x
Yodlee 97,000 50,000 47,000 1.9 x
Finicity/Mvelopes 91,000 73,000 18,000 1.2 x
Buxfer 9,000 3,500 5,500 2.5 x
PearBudget 6,300 2,100 4,200 3.0 x
ClearCheckbook 6,200 2,800 3,400 2.2 x
BudgetTracker 12,000 12,000 0 Flat
  Total 910,000 380,000 530,000 2.4x

Table 2: The online PFM class of 2008

  Sep 2008 Sep 2007 Gain
PNC Virtual Wallet 140,000 0 140,000
Rudder 50,000 2,000 (1) 48,000
Expensify 9,600 0 9,600
GreenSherpa 6,300 0 6,300
RateSurfer 4,400 0 4,400
Thrive 3,500 0 3,500
Expensr 2,900 0 2,900
Banzai 2,700 0 2,700
iThryv 2,000 0 2,000
  Total 220,000 2,000 220,000
       
Grand Total 1.2 million 380,000 750,000

 Notes:

1. Sum of the monthly unique visitors from all PFM companies, visitors that went to more than one PFM provider are not eliminated from the total, so there is double counting in the totals. Data source is Compete, pulled 21 Oct 2008.

2. Rudder was previously Spendview, but we consider them to be essentially a new company.

Comments (3)

Finovate 2008 BillShrink

By Jim Bruene on October 14, 2008 12:11 PM | Comments

image Drum roll, please. Our final presenter today is Peter Pham, CEO of BillShrink.

Menlo Park, CA-based BillShrink launched its new service in July.

The service is designed to help consumers find the best deal in various categories. Today they showed the credit card selector. The service provides detailed breakdowns of fees and rewards to allow consumers to compare across more than 200 cards in the market.

Launching today is MyAccounts which allows users to track their accounts more easily.

BillShrink also tracks wireless carriers and allows users to find the best mobile phone deals.  

BillShrink announced an $8 million dollar funding today.

Comments

Finovate 2008 Thrive

By Jim Bruene on October 14, 2008 11:45 AM | Comments (3)

image The second-to-last presenter today is Thrive from Loudwater Labs. CEO Avi Karnani will be conducting the demo.

New York City-based Thrive is the latest entry in the online personal finance market.

What's New
Thrive is making its official debut today at Finovate. They use a red light/green light system so it's easy to see what needs attention quickly.

Thrive calculates a financial health score from the user's data. Then Thrive shows users specifically how they can improve their score. The recommendations show financial institution products that can be used to achieve cost savings (i.e., product placements such as Mint).

On average they are recommending $1500 worth of savings for users.

Thrive has a wizard to help you see how much house you can afford.

Thrive today is announcing a partnership with Credit.com to allow users to track their credit score over time and improve it.

Comments (3)

Finovate 2008 Mint

By Jim Bruene on October 14, 2008 11:39 AM | Comments

image Mint CEO & Founder Aaron Patzer will be presenting next. 

Online personal finance provider Mint launched a year ago and won a Best of Show award at our first Finovate conference in 2007.

What's new
Mint moves out of beta today, with 500,000 users. Their sign-up rate has more than doubled in the past 3 weeks.

Today they launched new investment tracking functionality that allows Mint users to track their accounts at more than 1000 investment companies, mutual funds, and retirement services.

A unique aspect of its investment tracking is the ability to see the value of the account vs. the cost basis.

Mint has an IRA Rollover Advisor where they are partnering with Fidelity, Scottrade, E*Trade, and Schwab.

Results: 10% of users have changed investment behavior and 50% of users have changed their spending behavior by using Mint.

Comments

Moneytrackin' is First Major Online Personal Finance Management App to Make it Into the Apple App Store

By Jim Bruene on September 30, 2008 8:05 PM | Comments (2)

image I'm certain most major PFM providers will have an iPhone app within the next six to 12 months. It's a valuable product extension from a functionality standpoint (see note 1). Even more important are the marketing benefits from blogger/press coverage and the App Store listing itself. 

Mint posted a blog entry last week reviewing ten iPhone finance apps. The post drew two dozen comments, most asking when a Mint app would be released for the iPhone. Mint Product VP Aaron Forth replied, "We are busy working on one now."

Most of the better-funded PFM companies are likely working on an iPhone app, but the approval process at Apple can easily take a month or more (one developer's story is chronicled here). So we expect to see them trickle out over the coming months.

Moneytrackin iphone app for personal finance management 30 Sep 2008 The first established online PFM to make it into the iPhone App Store is Moneytrakin', the Barcelona, Spain-based multi-language, multi-currency PFM (note 2). We covered its launch more than two years ago (here).

The company recently announced it had surpassed 5 million transactions tracked. Assuming 250 per customer, that's 20,000 active users. According to Compete, U.S. website traffic averages 1,000 to 2,000 per month. But many (most?) of Moneytrackin's customers are outside the United States.

The Moneytrackin' program, released on Sept. 19, is currently the seventh most popular app in the Finance category.

Notes:
1. For more information, see our Online Banking Report on Personal Finance Features.

2. There are at least a dozen check registers and mini PFMs in the App Store, but none are from established online PFM providers. The only exception is iBuxfer, which claims to work with Buxfer using its API, but was not developed by the company. And in fact, according to the comments in the App Store, may be violating Buxfer's terms of service. All the more reason to get your own app into the store before someone else does.

Comments (2)

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:

Note:
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, JustThrive.com, 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

Comments

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.

Analysis
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)

image

Note:
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

imageimage

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)

image


iThryv "Make $" tab
(8 Sep 2008)

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Notes:
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.

Comments

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

Notes:
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.

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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)

image

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.

image

Notes:
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 <spendview.org>, but the original spendview.com now redirects to rudder.com.

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

Comments

First Sales Report on an iPhone Finance App: Tipulator Downloaded 3,200 Times

By Jim Bruene on August 15, 2008 5:13 PM | Comments

imageAccording to TechCrunch, the $0.99 tip calculator app from TapTapTap has been downloaded 3,200 times in the month it's been available. Net income to the developer, after Apple takes its 30% cut, is $2,200.

TapTapTap also markets a much more sophisticated location-based search tool that has generated $50,000 in revenues for the developer.

Tipulator is ranked number 20 in our Aug. 5 rundown of the top-20 banking and finance apps. Today it ranked number 27.

Apple ranks the most popular apps within each category, but does not provide download totals. Tipulator numbers were provided by developer.

What it means
1. iPhone users, so far, are willing to pay for apps. Who would have thought that more than 3,000 people would go to the trouble to download an app to help them multiply their bill times 15% to 20%? And there are two tip calculators that ranked higher in the App Store.

2. There is real demand for mobile financial tools, even very simple ones. Financial institutions should consider launching a branded calculator app in the Apple App Store.

Comments

Wesabe Adds Twitter Integration for Account Updates

By Jim Bruene on August 11, 2008 11:27 AM | Comments

imageWesabe's latest feature, the ability to update your account via Twitter, isn't likely to find too many users in the short-term. However, it's a great marketing move that could see a fair amount of uptake over time (see note 1).

Although there are less than 2 million Twitter users, the company is currently white hot, one of the most talked about Internet companies (see Google trends below, which shows Twitter search volume is 7x or 8x that of "phishing"). So why not draft off Twitter's hype, as long as it's not too costly?

How it works
After logging in to Wesabe and providing your Twitter name, you then simply send a private or public message (aka Tweets) to Wesabe's Twitter account. Wesabe then adds the expense to your cash-tracking account. You can include merchant name, expense categories, and descriptions to the transaction (see examples below).

Most common: Update via private message (no one else will see)

Private Twitter message to Wesabe


Less likely: Update via public message
(your friends will receive it, and if you have an open feed, anyone could see it)

Public Twitter message to Wesabe

 

Google Trends for Twitter vs. phishing (9 Aug 2008)

image

Note:
1. Updating accounts via text message and email has much wider appeal. It's one of the recommended items in our personal finance feature set. See our Online Banking Report on Personal Finance Features for more info.

Comments

Mint Site Traffic Grows by 60,000 in July

By Jim Bruene on August 7, 2008 4:48 PM | Comments (1)


According to Compete, website traffic to personal-finance startup Mint increased to 460,000 in July compared to 400,000 the month before, for a 13% increase. Site traffic has quadrupled since December, gaining 350,000 unique monthly visitors.

Comments (1)

Frost Bank Momentum Account Combines Reward Checking and Personal Financial Management

By Jim Bruene on July 30, 2008 1:08 PM | Comments (2)

image After a solid decade ignoring the financial management features of online banking (see note 1), we now have two banks doing very interesting things melding transaction accounts with personal financial management.

Frost Bank is the latest visionary, launching its Momentum Account this week (press release). The account melds high-yield checking, goal-oriented savings, and financial management into one online offering. Unlike PNC Bank's VirtualWallet, which is clearly aimed at the youth market (see previous coverage), Momentum goes directly to the online sweet spot, 30- and 40-somethings trying to manage their money in a more systematic way.

Frost Bank Momentum Account video page (30 July 2008)

The account
Basically, it's a fee-free, interest-bearing checking account with the usual freebies: debit card, online banking, bill pay. After the first three months, balances of $15,000+ earn 3% and those under $15,000 earn basically zero. However, the bank has added an interesting twist they call "DIY APY (see screenshot below). For every 10 monthly debit card transactions, they add 5 basis points to the interest rate, up to a maximum gain of 0.25% (for 50 debit card transactions).

That's a piddling amount, earning about a buck a month (pre-tax) for someone with $25,000 in the account typically doing 10 to 19 debit card transactions monthly. Yet most consumers like the feeling of winning the rewards game, so it should be good for marketing and retention.

Like PNC's VirtualWallet, online account opening is powered by Andera.

The innovations
Besides the DIY APY gimmick, the new account is noteworthy because it incorporates goal-oriented savings and transaction tracking into the interface. Users can allocate funds to one or more savings goals and set up automated transfers to the savings sub-accounts.

The interface also includes budget-categorization features using the folders metaphor. And the usual charting and graphing functions are available. Unfortunately, there is no online demo, so I could see only the features in the bank's demo video. 

Is it trendworthy?
I'm not ready to say that two examples make a trend, but given all the interest by investors and the press in online personal finance, I think this is the beginning of an interesting period in online finance product development.

Frost Bank homepage announces "DIY APY" (30 July 2008)

Frost Bank homepage announces Momentum account (30 July 2008)

Note:
1. See Online Banking Report: Personal Finance Features for Online Banking for more information on the pros and cons of various personal finance features.

Comments (2)

Green Sherpa to Enter the Online Personal Finance Market in September

By Jim Bruene on July 18, 2008 5:59 PM | Comments (4)

image I came across Green Sherpa in a Web search a few weeks ago. The Santa Barbara, CA-based startup is planning a Sept. 8 launch. The homepage (shown below) is not currently functional. All links point to a page where users can sign up for more info to be delivered at a later date. 

The tagline, "A more efficient way to track your personal finances," is intriguing (note 1), but no word on how Green Sherpa will differentiate itself from Mint, Jwaala, Wesabe and the rest. But the name is wonderful.  

Green Sherpa homepage 18 July 2008

Note:
1. This tagline, visible on its placeholder site in early July, has since been replaced with "Sophisticated cash flow management that's simple to use." 

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PNC Bank Takes on Mint & Quicken with PNC Virtual Wallet

By Jim Bruene on July 14, 2008 6:53 PM | Comments (13)

image Just when you thought Mint, Wesabe, and Geezeo had a lock on all the headlines for Gen Y personal finance, along comes a truly inspired effort from a major U.S. retail bank. Furthermore, it's not from Wells Fargo, Bank of America, Chase, or even ING Direct.

Pittsburgh, PA-based PNC Bank, the 15th-largest U.S. retail bank with $83 billion in deposits (see note 1), today launched a new online combo account called PNC Virtual Wallet.

The account comes with a checking account, bill payment, and two types of savings accounts. It also features several unique personal financial management features with an emphasis on functions most likely to appeal to a 20-something audience:

  • Cash flow: debit card, checking, online bill pay, financial calendar, recent transaction report
  • Savings: two types of savings accounts, automated savings options, wish list, and a random video-game-inspired savings tool called "punch the pig" (see below)

Finally, the account is priced well:

  • No fees (except $0.50 per written check after the first 3 per month and the usual penalty fees)
  • Free overdraft protection among linked accounts
  • 3% APY on the growth savings component
  • ATM-free rebate (but only if there's a $2000 average monthly balance in the checking account portion)

What's innovative? (note 2)

  • Package of three deposit accounts: Spend Account (e.g., checking), Reserve Account (e.g., savings) and Growth Account (e.g., high-yield savings or money market deposit account)
  • Ability to move money among the three accounts by moving a slider across the screen, called the Money Bar
  • Automated savings function called Savings Engine that allows users to set up time-triggered (e.g., once per week) or event-triggered (e.g., each debit card use) automatic savings transfers
  • Savings game called Punch the Pig, a video-game-inspired savings gimmick: Each time the pig appears on screen, users can elect to "punch" it to automatically move money from checking to savings
  • Wish List with savings goals and progress reports

What can be improved?
Four areas that are noticeably absent, or at least not mentioned:

  • Mobile functionality, especially text banking and alerts
  • Online customer support: Customer can apply online through the Andera-powered app; however, there is no link to any online-support options such as chat, IM, text, or even a Web-based input form or old-school email address
  • Social aspects: forums, reviews, blogs, or even testimonials (note 4)
  • Credit: credit cards, line of credit, auto loans, and so on

The website design is impressive and very un-banklike, yet it lacks some basics:

  • No demo: There are several Flash instructional videos that show most of the key features, but there is no all-encompassing demo for users wanting a tryout before buying.
  • Lame homepage videos: Granted, I'm not in the Gen Y target market so I could be wrong, but if I think the videos are lame, what do you think a 22-year-old will make of them? I say lose the "man on the street videos" or reshoot them in a less-scripted manner. 
  • Extensive FAQs: The FAQs need to be expanded tenfold. Currently, only 16 questions and answers are up, but with so many unique features, that number doesn't come close to answering many basic questions, such as "Are there account alerts?" or "What's the rate of interest on the reserve account" (note 3), or "How long are transactions stored?"

PNC Bank virtual wallet homepage (14 July 2008)

PNC Bank Virtual Wallet home 14 July 2008

Explanation of "Punch the Pig" savings feature

PNC Bank Punch the Pig feature in VirtualWallet 14 July 2008

Notes:
1. Deposits as of 31 Dec 2007; deposits were up 25% compared to $66 billion as of year-end 2006.

2. PNC has applied for a patent on the account and tools.

3. Eventually, I did find a link to interest rates and fees on the "how to apply" page

4. See Online Banking Report on Social Personal Finance for more info

Comments (13)

FiLife Debuts, Personal Finance Powered by Dow Jones and IAC

By Jim Bruene on June 13, 2008 11:37 AM | Comments (2)

image I've been reading the FiLife blog and monitoring its URL since I heard about the intriguing concept last summer. After a couple false starts, the site went live yesterday.

The unique joint effort between News Corp's Dow Jones and IAC is a cross between a personal finance tool like those powered by LeadFusion, a finance forum like FatWallet, a voting site such as Digg, and a full-blown magazine such as Money. It's dripping with Web 2.0 touches from the trendy design to blogging with attitude and harnessing the collective intelligence of the user base.

The core FI Deals area shown below allows users to self-assess their financial situations. In FiLife-speak, it shows how you stack up, in key areas such as income, home value, credit score, debt and even the value of your car. The people pyramid (in the screenshot below) shows an orange stick figure representing where you stand against the rest of the country.

Following a few ideas on how to improve your standing, FiLife presents financial deals in descending order of how valuable the FiLife community deems them. In this case, a mortgage offer from Citibank is listed first due to its top-of-the-line 5-point score. In this case, since it's the first day the site's been live, the score comes from a single review by a FiLife staffer. As the site gains users, this score would reflect the average across all reviewers.

FiLife main page with stackers completed 12 June 2008

The other key area is the FiDeals (screenshot below). Here users can search the top deals across all categories as voted on by the community. Some deals have been placed in the site via sponsorship dollars. Those are indicated by the gold pyramid. Blue pyramid offers have been added by staff members. In either case, the score shown within the colored pyramid reflects the vote of the community, which includes staff member votes.

FiLife FiDeals main page with sponsored vs non-sponsored deals  11 June 2008

First Impressions
The deep-pocketed owners have the resources to build traffic and establish the FiLife brand, if they find it profitable. Assuming it gets significant visitor traction, this could be the place to find financial and banking deals online, at least in the United States.

The business model is clearly ad-supported. There's nothing on the site at this point that would command subscription fees. And so far, the advertising is less intrusive than many other financial portals. And the bright look and good organization, not to mention professional personal finance content, add up to a potential winner.

But FiLife faces the same problem all ad-supported personal finance sites have: how to walk the fine line between the needs of users who want to find the best price vs. that of the advertisers that do not want to compete solely on price. FiLife sponsors may bolt if the community consistently posts poor reviews on their price-value. On the other hand, Google is dong just fine with AdWords, by ensuring that advertising is relevant. It will be interesting to see how FiLife strikes the proper balance.  

And it's no sure thing that FiLife ends up as the winner in the space. FiLife faces competition not only from startups such as SmartHippo, Wesabe, and Mint, but also from entrenched sites such as BankRate and TheStreet.com. And don't count out the incumbent personal finance magazines, including Dow Jones's own SmartMoney. These properties have enormous brand recognition and have already built substantial websites.

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Wall Street Journal's Walt Mossberg Loves Mint, Hates Financial Email

By Jim Bruene on May 1, 2008 2:49 PM | Comments (1)

imageIt was online banking week in Walt Mossberg's popular Wall Street Journal technology columns. Yesterday in The Mossberg Solution, authored by 20-something Katherine Boehret and edited by Mossberg, Mint's personal finance service received a half-page article so complimentary I had to look twice to make sure it wasn't an advertisement. Boehret couldn't find a single thing wrong with the service, although she did wish for bill payment capability so she could do all her banking with Mint. I'm sure she'll have her wish granted relatively soon.

image In today's Personal Technology column entitled, How to Avoid Cons that Can Lead to Identify Theft, Mossberg himself dropped a bomb which will impact bank-marketing efforts for years to come. His first of seven tips for safe computing:

Never, ever click on a link embedded in an email (from your) financial institution....

That's harsh, but it's also understandable why he'd take that stand. Mossberg strives to make technology issues understandable to non-techie readers. However, it would have been better to add, "unless your bank adds account-specific personalization to the messages so you know for sure where they originated." 

Action items
Many financial institutions, including Citibank and Bank of America, have long used personalization to distinguish legitimate messages from phishing attempts. Financial institutions with good personalized messaging should consider a public outreach program to counter the negative perception from the Mossberg column. It also might be a good time to remind front-line employees how to respond to customer concerns about phishing emails.

For more information, see our Online Banking Report on Marketing Security

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Bank of America Reports 2.5 Million Users of My Portfolio, its Online Personal Finance Tool

By Jim Bruene on April 21, 2008 6:27 PM | Comments (1)

image Two months ago we published a table (here) showing active users at the leading online personal finance startups. Below is the table, updated with March traffic and the addition of one more player: Bank of America.

The bank, which offers a full-featured online personal finance management solution called My Portfolio, powered by Yodlee, has 2.5 million active users, according to BofA exec Marina Moore (note 3). That's an impressive 10% of the bank's online user base, and about 6x the total user base of all the online startups combined (note 4). 

Company Users (1) % of Total March Traffic(2) Jan Traffic(2) Chg
Bank of America 2.5 million 86% -- -- --
Mint 180,000 6% 160,000 150,000 7%
Wesabe 100,000 3% 28,000 41,000 (32%)
Buxfer 80,000 3% 8,400 9,200 (9%)
Geezeo 20,000+ 0.7% 8,400 14,000 (40%)
NetWorthIQ 13,000 0.5% 10,000 11,000 (10%)
BillMonk 10,000+ 0.3% 1,700 1,000 +70%
Expensr Five figs 0.3%+ 2,000 1,700 +18%
Total 2.9 million 100%      

For more information:

Notes/Sources:

1. Users: per BusinessWeek Online, Feb 2008, figures are reported by the companies and may include inactive users; Mint has been updated to 180,000 from 130,00 based on new figures reported in the Bank Technology News article published in April 2008

2. Traffic: per Compete estimates of website traffic for March 2008, retrieved April 21, 2008. Compete estimates traffic from its online data and can be off by a factor of two or three-fold for smaller websites.

3. As reported in a Bank Technology News article published in April 2008.

4. This table does not reflect all the players, such as Intuit's new Quicken Online, just the ones highlighted in the BusinessWeek article.

Comments (1)

400,000 Users at Online Personal Finance Startups

By Jim Bruene on February 22, 2008 10:16 AM | Comments (3)

link to BusinessWeek article In a Feb. 11 BusinessWeek Online feature (here), reporter John Tozzi listed the self-reported user bases at seven new entrants in online personal finance. The roundup led with an anecdote about Wesabe CEO Jason Knight answering phone calls from users (see inset).

The seven companies listed below are only a subset of the online personal finance space. The list does not include users at Quicken Online, Yodlee, Mvelopes, and another two dozen smaller players. Nor does it include users at financial institutions that support online personal financial management such as Bank of America, Wells Fargo, Key Bank, River City Bank and others.

Company   Users Traffic
Mint* 135,000 150,000
Wesabe* 100,000 41,000
Buxfer*   80,000   9,200
Geezeo   20,000+ 14,000
NetWorthIQ   13,000 11,000
BillMonk   10,000+   1,000
Expensr* Five figures   1,700
Total 370,000+ 230,000

Sources: Users per BusinessWeek Online, Feb 2008, figures are reported by the companies and may include inactive users; Traffic: Compete, Inc, estimated unique visitors for January 2008

*Will be presenting at our FINOVATE Startup conference April 29, 2008

For more information:

  • Previous NetBanker coverage here
  • Online Banking Report #131/132: Personal Finance Features for Online Banking
  • Online Banking Report #142/143: Social Personal Finance
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Quicken Loans Enters the Personal Finance Space with Quizzle

By Jim Bruene on February 18, 2008 9:42 AM | Comments (3)

image Two years ago, computerized personal financial management was a two-horse race: Intuit's Quicken vs. Microsoft Money. Both full-featured. Both relatively easy to use. But both were packaged software apps, clearly not the future of consumer computing.

Fast forward to 2008: We now have two dozen startups, several banks, and other financial stalwarts, offering online personal finance of every size and shape (see Online Banking Report 142/143 and 131/132).

image The latest entrant: Quicken Loans, which launched an open beta of Quizzle, an online budget and personal finance portal that features home values, mortgage advice, and free credit reports/scores from Experian (see note 1).

Quizzle also calculates what it calls your Quizzle score based on your credit score, home value, savings, debt, and household income/expenses (see second screenshot, below). Debt payments are imported from credit report data, but users can edit the information or add other items to improve the results.

Quizzle also provides home-value estimates calculated from public records, but in my case, it's no Zillow, and listed a home value that was significantly wrong (see note 1).  But it's simple to edit the number with your own estimate. Quicken Loans should consider tapping Zillow's API to provide a second opinion.

The sign-up process
Signup is simple with users providing name, address, birth date, email address, income, and home-purchase date. Email address is verified with a message that must be confirmed. Then identity is verified online using data pulled from the Experian credit bureau.

This is the same procedure used by every online credit-report provider with one huge exception. Quicken Loans DOES NOT REQUIRE A SOCIAL SECURITY NUMBER, a huge usability and privacy gain. The company is allowing credit-report access based on a name/address/birth date match. That's a welcome improvement for the user.

Analysis
There are a few rough edges in the tool. The home-equity portion is not well explained. In my example, my home value was shown to be about $50,000 more than the loan balance. However, in the equity portion of the tool, it showed that my home equity to be zero. Evidently, the site uses an 80% LTV criteria to calculate the amount of home equity available to lend against. While that's a perfectly reasonable assumption in today's credit environment, it should be spelled out in detail.

But overall, it's a great tool. The really free credit report and score alone are enough of a payback to gain consumer usage. The rest of the Quizzle score is less useful, but still interesting. And seeing it all in one place is fantastic. It will be interesting to see how Quicken Loans pulls me back to the site in the future.

Quizzle is off to a great start, and I look forward to seeing more companies, including banks, credit unions, and card issuers, integrate credit scores/reports into their online offerings (see note 2).

Overall scores:
    Look and feel (user interface) ==> A
    Credit information ==> A+
    Other tools ==> B
 

Quizzle home (18 Feb. 2008, prior to entering a ZIP code)

Quizzle from Quicken Loans home 18 Feb 2008


Overview pages showing the makeup of the overall Quizzle score

(upper right)

Quicken Loans Quizzle main results page

Note:

1. Quizzle uses a 900-point scale for credit scores, padding 50 points to everyone's score compared to Fair Isaac's FICO that tops out at 850. This makes you feel a little better about your score. No doubt, credit score inflation will continue, with someone using a 1,000-point scale in the near future. 

2. WaMu has provided free credit scores to credit card customers for several years.

Comments (3)

Quicken Draws a Line in the Sand, Places $36/yr Value on Online Personal Finance

By Jim Bruene on January 10, 2008 12:10 PM | Comments (4)

link to Quicken Online The two dozen online competitors of Intuit's Quicken can breathe a sigh of relief today. The 800-lb guerilla has done them a favor, levying a monthly fee for its new online-only option, Quicken Online (press release here). While the $2.99/mo fee, after a free month, is reasonable, it's much different than FREE. Look for the websites of the competition to trumpet the $35.88 annual savings very soon.  

Intuit could easily have offered its online option free of charge. While that would cannibalize its packaged version, the overall impact to its bottom line would have been insignificant (note 2). And a free Quicken would have made it much harder for Mint, Wesabe, Geezeo, Buxfer and others to gain a footing (note 1).

My guess is that Intuit doesn't feel too threatened by the startups, yet. The security issue is extremely difficult for a new company to overcome. Intuit is one of the few tech companies with a brand that has trust levels on par with a financial institution. Millions already entrust their entire tax return, which has far more personal info than an online bank account, with the company. 

Intuit will allow the startups to build a following, then acquire the promising ones and convert their users to Quicken Online. All for less than the cash it would have foregone by offering Quicken Online free.  

We'll compare and contrast Quicken Online with the startups in an upcoming Online Banking Report (previous reports here and here).

Quicken Online hompage 9 Jan 2008

 

Notes:

1. A few hours before Quicken Online went live, Mint issued a press release trumpeting its 100,000 registered users. That's an impressive number for a company that went live in September (previous coverage here). However, assuming 20% to 25% of those are active, there are still more than 500 times as many Quicken desktop users. 

2. Intuit's fiscal 2007 pre-tax profit was $670 million. 

Comments (4)

Intuit's Quicken Online to Launch in January

By Jim Bruene on December 20, 2007 3:08 PM | Comments (2)

Intuit has been beta testing a fully online version of its flagship product Quicken since September. According to Eileen Ambrose, writing for the The Baltimore Sun (here), the product will launch Jan. 8, 2008, at a price of $2.99/mo (note 1), $12 more than the entry-level, packaged version ($24 at Amazon), but $8 less than Quicken Deluxe ($44 at Amazon).   

Intuit is already advertising it on Google when searching "quicken online." Below is a screenshot of the landing page (here):

The service is still in beta and requires an "application" to use. Interestingly, one of the requirements listed in the FAQ is that beta testers must allow Intuit to download data from their bank account nightly. So obviously, account aggregation is a key component, not that that's a surprise. Automated account downloading is now "table stakes" for online personal finance.  

We'll look at the service in detail after we've had a chance to use it.

Note:

1. Intuit's ad on Google says (below), "Sign up for the new Quicken Online Free!" which sounds like a lot less than $36/yr.

Comments (2)

Wesabe is First with True Online Banking Widget

By Jim Bruene on November 12, 2007 5:56 PM | Comments (1)

We first discussed the usability advantage of direct-to-the-desktop information delivery in the 1998 Online Banking Report, Creating the Amazon.com of Financial Services  (see note 1). We called it a "meter" instead of today's widget or gadget, but its essential function was to show balance levels on the user's PC without requiring a login each time.

Last week, Wesabe became the first company to implement that concept with its Mac Widget shown below (Wesabe link here). The widget displays the balances in the various accounts tracked through the company's personal finance platform:

Several other personal finance companies have previously launched widgets including ClearCheckbook which released a Google Gadget on March 14 (here) and  Mac Widget a few days later (here). Other financial widgets are offered by billQ, Buxfer and Mortgagebot (see previous coverage here and here).

However, Wesabe is the only one streaming real-time balance updates thanks to its automated downloading of account data from linked financial accounts (aka account aggregation). Without the automatic updates, a widget is more window dressing than functional tool.  

Therefore, we're giving Wesabe its second OBR Best of the Web this year in recognition of its new widget which once again raises the bar for financial information delivery (note 2), if only for Mac users. 

Notes:

1. We last covered desktop technologies in a 2002 Online Banking Report, Grabbing Desktop Mindshare (# 85).

2. Recent OBR Best of the Web winners are covered here. Five awards have been handed out this year: two for Wesabe, and one each for Jwaala, Buxfer and Obopay. In the past 10 years, 67 companies have won Online Banking Report's Best of the Web awards. Only five companies prior to Wesabe have won the award twice: Bank of America, Citibank, E*Trade, Everbank, and Wells Fargo.

Comments (1)

Banzai, New Online Personal Finance Site Opens to Public

By Jim Bruene on November 8, 2007 12:22 PM | Comments (1)

Joining the increasingly crowded online personal finance space is Banzai, the brainchild of Morgan Vandagriff (LinkedIn) who envisioned the system while working for a wealth management-advisory firm, SEI Investments.

Vandagriff, a 2002 Wharton biz school graduate, is positioning his firm as a financial assistant, not just a financial automation tool. Rather than sit back and let users put their finances on autopilot, Banzai induces them to spend 5 minutes every day tracking and categorizing their spending. And unlike Web 2.0 companies hoping to scale to millions of users with a handful of employees, Banzai assigns a personal coach to each user and actively encourages users to make contact.

Banzai homepage 

How it works
Banzai uses "jars" as the metaphor for budget categories. Users establish jars for every bill, spending category, and income item. Transactions are uploaded from previously downloaded bank and credit card statements using a proprietary uploader similar to Wesabe's. Entries can also be made manually.

Banzai then forces users to take money for every transaction from one of the pre-established jars. It believes that it's important for users to "touch" every transaction to see how it impacts their pre-established spending plan. If a jar is empty, say groceries, then users must take money from another jar to cover the transaction. It helps users see the tradeoffs in spending. It's not a zero-sum game. Users can have their "reserve" jar go negative, signifying debt spending.

Take the company tour here.

The company
The four-person company is headquartered in Provo, UT, coincidentally just 10 miles from their most similar competitor Mvelopes, a personal finance site established in 2002 and run by Finicity (formerly In2M). The company has been in development mode since early this year. It is planning an official launch (to public beta) on Nov. 12, but anyone can sign up now at its website.

The company also competes with newer players, Wesabe, Mint, Buxfer, Jwaala and others and the big packaged-software players, Intuit's Quicken and Microsoft Money (note 1). Like its most-similar competitor, Banzai's business model calls for modest monthly or semi-annual fees; in this case, $4.95/mo or $29.70 for six months. The $30 fee includes a copy of a 120-page book, The Banzai Way.

First impressions
Banzai has a great logo, user-friendly layout, vibrant color and easy-to-read copy. The company has developed a good product tour, YouTube video, and blog - all the usual trappings of a Web startup, circa 2007. And the founder sounds very customer focused. It's unfortunate that a video game occupies the primary URL <banzai.com>. The company's  <banzaiway.com> address along with the unusual spelling, will make it somewhat harder to find.

I like what Banzai is doing, but I wonder, as I always do, how the company will attract users. Few people have the discipline to spend any time, let alone 5 minutes a day, managing their finances, and most of those already use Quicken or Money. And the $5/mo fee puts Banzai at a disadvantage compared to the free sites. 

However, Mvelopes has survived at double that rate, and if customers can be convinced it works, one caramel macchiato per month is not much to pay to keep your financial house in order. In fact, a site is somewhat more trustworthy when its business model is obvious, an important benefit in online finance. Finally, putting a a face on the product with a personal coach on call may help differentiate Banzai from the free sites. 

Screenshot: Transaction sorting

Banzai transaction sorting screenshot

Screenshot: Jar setup wizard 

Note:

1. See our recent research on personal finance in Online Banking Report #142/143 and #131/132.

Comments (1)

Mint Lands More Press Coverage

By Jim Bruene on October 23, 2007 10:08 AM | Comments

Mint has certainly caught the attention of the nation's press. Over the weekend, I watched CEO Aaron Patzer interviewed on San Francisco's channel 5 (video here). Today, the Wall Street Journal ran a Q&A with Patzer in the Lee Gomes Talking Tech column under the headline, Financial Software Moves to the Web (p. B3, see note 1). The WSJ article itself is a throwback to the late 1990s, talking about the advantages of Web-based apps vs. desktop apps. 

The Mint press coverage reminds me of the 2000/2001 period when Yodlee and Vertical One burst on the scene with "account aggregation" services. Mint wisely steers clear of that out-of-fashion term and focuses on the benefits it provides, namely saving users from themselves by pointing out the sometimes substantial money to be earned putting spare cash to work in a higher-yield account.  

We will continue to watch Mint closely, not because its services are unique: Yodlee, Wesabe, Jwaala, Geezeo, Digital Insight (Intuit) and many others provide essentially the same thing. But Mint is the hot new kid on the block and seems to have struck a nerve, at least with the early-adopter financial junkies, which includes the personal finance press. It will be interesting to see how the company builds on its momentum and what implications, if any, its early success has on the broader banking marketplace.  

Note:

1. Thanks, Mom, for the WSJ tip. And no, the "developers conference" mentioned in the article was not our FINOVATE, it was TechCrunch 40 held two weeks earlier. Mint won awards at both.  

Comments

Using Mint (part 1): First Impressions

By Jim Bruene on October 19, 2007 2:06 PM | Comments (2)

link to mint.comEver since receiving a private beta-invite a month ago, I've been meaning to run new personal finance site Mint through its paces. Then, after it won Best of Show at TechCrunch40 and our FINOVATE conference, I really wanted to see if the product could possibly live up to the expectations created while watching CEO Aaron Patzer give a demo (see previous coverage here, see note 1 below).  

But it takes time to really analyze a website, and I hadn't got around to it until today, when I was inspired by Ron Lieber and his team at the new Dow Jones/IAC site FiLife (press release here) as they reported on their individual results using the Mint's online personal finance tools (see coverage here).

I will file a series of reports as I use the program over the coming weeks. Today, we begin with the first impressions.

First Impressions
Homepage: One thing you notice when you visit Mint.com is that it looks nothing like a banking site (see first screenshot below). That can be good or bad. It's good because it sets the site apart from a normal financial services site. But that can also be a problem because the first, second, and third things users care about at a new financial site is whether it's secure or not. And a bankish "look and feel" can increase consumer trust.

But Mint does an admirable job walking the fine line of creating an engaging look while still reassuring visitors that it fiercely protects their data and privacy. The three large benefit statements in the middle create interest in the product, while the bank logos and the TRUSTe at the bottom provide visual clues that Mint is a serious player.

And the graphic design, leveraging the clever "Mint" name, combined with the light green color scheme, create an inviting site that should do well converting lookers into registered users (active users is another matter, more on that later).

Copy is concise, just 60 words above the fold (see note 2), and completely benefit oriented. Learn more button allows users to drill deeper, and you can't miss the call to action, Sign Up Now in the middle of the page.

Features page: Navigating to the feature page is simple, either click on the "Learn More" blue button in the middle of the page or use the "Features" tab at the top. The page does a great job laying out the key benefits with good use of headers and concise, bulleted lists supplemented with clear, attractive screen-captures of key points (see second screenshot below). Also note the prominent placement of big-name financial brands, Chase, Discover, and E*Trade, to increase trust.  

While the page does a good job highlighting features, it doesn't provide any interactive way of learning about the tool before signing up. Video and audio help goes a long way in demonstrating the features (see Jwaala/Amplify CU Money Tracker video here).

Mint.edu: A nice touch. Instead of calling it "education" or "blog" or something else no one would ever click on, Mint uses the clever Mint.edu (see third screenshot below). That's a URL that will resonate with its younger members and anyone familiar with higher education domain names. And once at the .edu site, engaging blog entries allow users to dig deeper into what is going on with the company and read about personal finance topics in general. RSS and email subscription options are clearly presented in the right-hand column.

Grade: A+

Mint Homepage (19 Oct 2007)

Mint.com homepage

Mint Features page (also accessible via "Learn More" button on homepage)

Mint.com features page

Mint.edu page (19 Oct 2007)

Mint blog page

Notes:

1. The video of Aaron Patzer's FINOVATE demo will be online within the next week at FINOVATE.com. In the meantime, you can see him on the Channel 5 SF news here.

2. Red line in screenshots 1 and 2 indicates the bottom of the screen using 1024 x 768 display on 13.3-inch laptop screen.

Comments (2)

Mint.com Traffic = $17 billion bank

By Jim Bruene on October 11, 2007 4:30 PM | Comments (3)

Compete's latest data confirms the spike in traffic at three-week old online personal finance startup Mint. The startup created considerable buzz after winning the $50,000 grand prize at TechCrunch in September (see previous coverage here).  

According to Compete, Mint's 200,000 unique visitors in September equaled that of $17-billion Webster Bank, the 64th largest U.S. bank or thrift holding company according to American Banker (Q1 2007). It will be interesting to see if Mint experiences a dramatic traffic decline after the publicity-driven visits slow down.   

Traffic at Mint.com (blue) vs. Webster Bank <websteronline.com> (red)

Mint vs Webster Bank traffic

Comments (3)

Mint Attracts 50,000 Users in First Two Weeks

By Jim Bruene on October 8, 2007 4:22 PM | Comments

New TechCrunch co-editor Erick Schonfeld posted a short article yesterday (here) about Mint winning the Best of Show award at our FINOVATE conference (note 1). That post allowed TechCrunch's 600,000 readers to weigh in again on the pros and cons of Mint's model. During the past 24 hours, it attracted 72 comments, many with security concerns. Mint's CEO Aaron Patzer bravely joined the discussion and posted a half-dozen of the comments himself.

It's interesting to understand the concerns posted by TC readers. Of course, this is not at all a mainstream audience, so we take the complaints with a grain of salt. But it's still indicative of the hurdles a new financial institution, especially an unregulated one, faces when launching a new service.

Schonfeld's post also included the first metrics we've seen from the two-week old company:

  • 50,000 total registered users
  • 35,000 active users (have come at least once since registering)
  • 5,000 power users (use it every day)
  • 5,000 mobile alert users
Comments

Geezeo iWants Facebook Users

By Jim Bruene on September 26, 2007 10:27 PM | Comments

 

I check Facebook about once or twice per week to see what new financial apps have been posted. So far the ones we've looked at include (see previous coverage here):

  • Lending Club's P2P marketplace
  • Prosper's Fantasy Banker
  • PayPal
  • Wesabe
  • Buxfer
  • TD Bank's Split It
  • Obopay's BillMonk

The latest entrant, iWant from online personal finance specialist Geezeo (see screenshot below). iWant is an application that allows Facebook users to share with friends their wants and needs, such as "buy an iPhone" or post more goal-oriented items such as, "pay off my student loans" or "throw a graduation party." And Geezeo ties it up nicely by tapping PayPal's API to facilitate "contributions" to the financial goals. It's also integrated into Geezeo's online personal finance application so users can track their goal progress in real time. ChipIn offers similar payment functionality in its Facebook app (previous coverage here).

I wonder if Geezeo will make a P2P lending play here? If Geezeo's software included a repayment option, the iWant "donors" could easily become iWant "lenders" and a whole new market might open up. 

If you are attending our upcoming FINOVATE conference next week in New York, you'll be able to ask co-founders Peter Glyman and Shawn Ward yourself. We are fortunate to have not only Geezeo, but two other early Facebook innovators, Prosper and Lending Club on the DEMO stage. If you can't make the event, check our website in two weeks for full length videos of each DEMO.

Comments

New Personal Finance Site: Pertuity Direct

By Jim Bruene on September 18, 2007 5:40 PM | Comments (4)

Does it seem like every NetBanker blog post lately is a plug for our FINOVATE conference (oops...plug #1)? Hmm ... maybe we are a little stuck there.

OK, here's an online personal finance startup that's NOT presenting at FINOVATE (plug #2), Pertuity, the brainchild of ex-PNC Bank exec Kim Muhota. I like the overall look (below), decked out in our FINOVATE colors (plug #3), but clearly it's a placeholder for something more substantive (see note 1).

The Dare to Compare function, while provocatively named, is basically a well-dressed financial calculator that shows you where you stand in terms of income, savings, and debt compared to the rest of the country and those in your age group. It's a nice feature, but hardly unique and certainly not enough to attract visitors, let alone bring them back (see note 2).

UPDATE: After seeing Colin's comment (below), I looked at the site again and realized that I missed the "create a new group" function that allows you to compare your income, savings and debt against other pre-defined subsets. That's an interesting angle and could create a more sticky site with users going back to see how they are growing their income/savings/debt compared to various peer groups. I look forward to seeing how this plays out at Pertuity.

The Rate Survey, Expert Advise, and Blog sections are also just bare-bones link areas with little original content so far. The site appears to have launched just last week, so we are not criticizing (yet), just pointing out the current facts.

The website says "coming in 2008," so we'll be sure to check back in six months and see if they live up to their homepage boast:

....as we gear up towards our launch in early 2008; when we will bring to market a disruptive set of products that will uncomplicate your life, simplify your money and free your dreams.

Note:
1. The homepage has an overall calm look and feel, refreshing for a finance site. But Pertuity needs to lose the clip art of the three scary "suits" in the lower right and enlarge and break up the block of 10-point type in the middle (same goes for the micro-sized font in the blog).

2. Colin Henderson blogged positively about the Dare to Compare feature yesterday (here), but so far anyway, I don't share his enthusiasm that it's "quite revolutionary."  Colin probably has a better crystal ball than I, so I'll reserve judgement until the official launch. (Also, see my update above; obviously, Colin did a better job reviewing the functionality than I.)

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Mint's Coming-Out Party at TechCrunch 40

By Jim Bruene on September 18, 2007 3:12 PM | Comments (2)

Update (8 PM Pacific): Earlier this evening, Mint was named Best Presenting Company at TechCrunch 40 (see here) and took home the $50,000 grand prize. A good first day in the life of the startup!    

Congratulations to Mint on being one of just two financial services startups to win a spot at TechCrunch 40, the tech-startup con-fab in San Francisco that concludes this afternoon. More than 700 companies applied for the presentation slots, and just 40 were chosen. The other financial company was Cake Financial which competes with Zecco, Covestor, and Social Picks, in the "social investing" space, i.e., companies that help users track their investment portfolios and share them with others.

Mint presented in the "Productivity & Web Apps" category this morning and received high marks, scoring a 4.0 out of a possible 5.0 from 67 voters. During the first seven sessions (35 companies), only three have scored higher than 4.0. Mint also received favorable comments from the expert panel comprised of Guy Kawasaki, Esther Dyson, Roelof Botha, and Mike Arrington (blog post here).

For those of you attending our FINOVATE conference Oct. 2 in NYC, you'll have a chance to see a live demo from Mint CEO Aaron Patzer. If you can't wait until then, Mint opened its personal finance app to the public today with a public beta version. Let us know what you think.

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Online Personal Finance Heats Up: Part 2

By Jim Bruene on September 11, 2007 5:53 PM | Comments

One of the biggest themes at our upcoming FINOVATE 2007: DEMOing the Future of Online Finance (here) is the interesting developments in the online personal finance space (see lineup below).

As we mentioned last week, the race to add personal financial management (PFM) features to online banking sites is just getting started. To some extent, every bank and credit union supporting online banking already offers extensive personal finance functionality. Think back on how the average person managed day-to-day finances prior to 1997: telephone calls, ATM slips, or in my case, the moment of terror once per month when opening the monthly bank statement.

But now that everyone offers base level PFM, the new race is to provide advanced features to hold on to customers, attract new ones, and potentially cross-sell complimentary products such as debt consolidation, mortgage refis, insurance and so on (see note 1). We also hope to see some fee income from the new features, either through elevated checking account fees, or with premium online banking surcharges (note 2). The latter appears unlikely to happen in the United States unless Bank of America starts charging fees.

At FINOVATE we'll see demos from five key players:

  • Two industry veterans, both two-time OBR Best of the Web winners, will be launching significant new versions this fall: Digital Insight (Intuit) and Yodlee
  • Two "class of 2007" new startups: Jwaala (coverage here) and Mint (coverage here)
  • And Geezeo, which recently changed its name and moved aggressively into personal finance (coverage here)

Digital Insight (Intuit)
One of the most intriguing acquisitions in online banking in the past ten years was Intuit's purchase last year of online banking platform provider Digital Insight (see coverage here and here). Everyone expected the merged companies to push hard on personal finance, the core of Intuit's much-admired brand. I've had a chance to see the Personal FinanceWorks and Small Business FinanceWorks demos several times and came away impressed. Combined with the depth of Digital Insight's client base, these products have a chance to become the online banking standard within a few years. Intuit is a two-time OBR Best of the Web winner with its Web-based tax services.

Yodlee
Yodlee
used to be known as "that account aggregation company." But over the years they've worked hard to shed that image and morph into a full-service financial tools provider. The company offers account-opening tools, bill payment services, personal financial management, long-term archives, and, yes, account aggregation, although it's now more integrated with the company's other services, especially its MoneyCenter personal financial manager. MoneyCenter is the engine behind Bank of America's MyPortfolio which helped Yodlee win its second OBR Best of the Web (see coverage here).    

Notes:

1. For more info on online personal finance, see Online Banking Report #132/133 and #142/143.

2. For more info on premium online banking pricing, see Online Banking Report #109.

Comments

Online Personal Finance Heats Up: Part 1

By Jim Bruene on September 5, 2007 3:26 PM | Comments (2)

The race to become the next Quicken of online finance is heating up this fall with several launches expected before year-end (note 1). At our upcoming new products conference, FINOVATE 2007, you will be treated to live demos of five leading personal finance apps. Three are newcomers: Geezeo, Jwaala, Mint, and two are industry veterans launching new online versions, Digital Insight (Intuit) and Yodlee. Here are brief profiles of two newcomers. We'll look at the other three in part two on Friday.

Jwaala
Jwaala, out of Austin, Tex., made a splash in March when it debuted on Amplify Credit Union's site, winning our OBR Best of the Web award in the process (see post here). The specific feature to win recognition (see note 1) was the personalized RSS feeds available to MoneyTracker users. The natural language search is also a significant improvement over typical expense manager search functions.

Jwaala, which was a finalist in the TechCrunch 20 start-up conference, has also built a simple Google-like, text-based ad server into its MoneyTracker interface. It allows CU and bank marketers to run relevant marketing and educational messages next to transaction data and query results (see screenshot #1 below). Amplify CU, which is an investor in Jwaala, has given the service considerable marketing play with several links on its homepage (see screenshot below) and a series of instructional/marketing videos accessible from the MoneyTracker landing page (here).

Mint
Mountain View, Calif.-based Mint is still in limited private beta, so we can't say much about its online personal finance manager. However, the company says this about itself:

Mint is building a free, simple, and secure personal finance web-app. Designed to be effortless, Mint consolidates your financial life in one place. Easily see how much you have, how much you owe, and where your money goes. Advanced alerts notify you before you bounce a check or forget to pay a bill. Patent pending algorithms even show you personalized ways to save and make more money. If your finances could use organization without effort, Mint is for you.

After putting our name on its mailing list several months ago, we finally received an invitation to its private beta Saturday. I am about to sign up, but since I will be sworn to secrecy, I wanted to finish this post first, so that I wouldn't have to worry about accidentally revealing a feature. As we mentioned in our previous post (here), you can learn quite a bit about the product and the company's outlook by reading the active Mint blog (see screenshot #3 below) which has published 102 articles in its 6-month history, an amazing amount of content for a company that hasn't yet launched its product.

Notes:
1. For more information, consult two recent reports from Online Banking Report: Online Personal Finance and Social Personal Finance.

2. OBR Best of the Web awards are given out occasionally for features that raise the bar in online financial services. It is NOT necessarily an endorsement of the company or its full product.

Exhibits 

Screenshot 1: Jwaala interface showing personalized "marketing bar" (4 Sept 2007)

 

Screenshot 2: Amplify CU homepage with links to Money Tracker (5 Sep 2007)

Amplify CU homepage 5 Sep 2007

Note: Amplify makes great use of video to sell the benefits. Check out the video tour of its "cafe style" branch (on the Amplify homepage here, click on the "play video" button to the right of the branch photo).

Screenshot #3: Mint blog main page (5 Sept 2007)

Comments (2)

Personal Financial Management Is Not The Cure For Online Banking Adoption Stagnation

By Ron Shevlin on August 24, 2007 9:20 AM | Comments (11)

A number of industry analyst firms have recently opined that developing online personal financial management (PFM) capabilities can help banks grow online banking adoption and strengthen their customer relationships.

My take: I disagree. In my opinion:
  1) growth in online banking adoption is a demographics game
  2) PFM will not drive further online banking growth
  3) most banks are wasting their money developing online PFM tools

First off, let's consider who isn't banking online. For the most part, it's older consumers. According to Forrester's numbers, 78% of Gen Yers and 72% of Gen Xers bank online. With already high adoption, and representing just 45% of the total online population, there's not a lot of room for growth there. With 57% of Boomers and 42% of Seniors banking online, any significant growth in online banking adoption will come from these segments.

But PFM isn't going to be the catalyst to make that happen. The primary hurdles keeping these "offline" bankers away from the online channel are security concerns and habit (they don't perceive there to be added convenience to banking online). On top of that, there are a number of people who enroll for online access and then find it to be cumbersome and difficult to continue.

PFM isn't going to help overcome those hurdles. Javelin Research recently found that just one quarter of online bankers were interested in online PFM. So why would the holdouts be more interested? Computer-based PFM tools (not just online ones) have been around for a long time. You probably even own a copy of Quicken or Microsoft Money. The number of people who own copies of these programs is in the multi-millions. The number of people who regularly use their copy of the program is....well, much less.

Now you can cite all the market research you want about how consumers want more help managing their finances and tools to help them manage their budget and finances. But intentions don't always translate into actions. If today's 40, 50, and 60-year olds haven't started using PFM tools yet -- and aren't online banking either -- offering PFM tools online isn't going to lure them online.

The market for online PFM isn't online holdout Boomers and Seniors, but Gen Yers (and the next generation of consumers) who are already online -- and a whole lot more involved in managing their financial lives than Boomers or Seniors were at that age. But Gen Y is already banking online, so PFM tools aren't needed to lure them online.

And unfortunately, what banks are offering (or considering offering) may not help deepen the relationship, either. These young consumers want help making smarter financial decisions -- not just tools to track and manage their finances. And most of the online PFM tools that banks are developing don't do nearly as good a job of doing this as offerings from sites like Wesabe do.

The fact of the matter is that banks have, for the most part, missed the boat on this opportunity. It might not be too late for banks to develop a Wesabe-like capability. But it's not time, money, or technology capabilities that keep banks from doing it. It's culture, mindset, and the practices banks use to justify their investments. 

Banks who invest in online PFM capabilities will look to justify their investments through incremental cross-sell. But consumers who do adopt these tools will run away faster than you can say BOO if their bank starts aggressively cross-selling through their PFM implementations.

It really comes down to strategy and business model considerations. Banks looking for answers to how to attract new customers and deepen relationships with customers aren't going to find them by trying to grow online banking rates with PFM tools. Banks need to figure out how to make a profit by helping consumers manage their money -- and not just by pushing more checking account and savings accounts at customers and prospects.

Ron Shevlin is Vice President of Client Solutions at Epsilon. Prior to that, Ron was an analyst at Forrester Research. He opines (translation: rants) about financial services marketing at Marketing ROI: Whims From Ron Shevlin. The opinions expressed here are Ron's, not those of NetBanker, his employer, or any firm trying to help banks build online PFM tools (obviously).

Comments (11)

TD Canada Trust Launches "Split It" on Facebook

By William Azaroff on August 16, 2007 5:20 PM | Comments (8)

While so many FIs are scratching their heads wondering what to do about Facebook, it turns out that TD Canada Trust, one of Canada's biggest banks and the ninth largest bank in North America, is doing all kinds of interesting initiatives there.

What makes their efforts so impressive is that they have clearly tried to figure out the value they add to the demographics of Facebook users. They have managed to strike a balance of being true to their brand, yet not seem like they're pandering to a youthful audience, and offering something of value to the Net Generation.

What first crossed my desk this week was SPLIT IT, an application they created that allows roommates who are on Facebook to manage how they split basic bills.

SPLIT ITSPLIT ITSPLIT IT

Welcome to the SPLIT IT by TD Canada Trust application – a no-hassle, budget-sharing tool that enables you to share bills with your roommates. SPLIT IT makes it easy to determine who owes what, view your balances, and keep on top of your payment dates.

SPLIT IT

The application launched within the past few days. When I first saw it on August 15 it had 44 users. It's grown to 66 a mere 24 hours later. It will be interesting to see where it goes during the  next few weeks. I'm also curious to see how it's promoted. Will TD send information to its youth customers, or will they rely solely on word of mouth?

 SPLIT IT 

SPLIT IT 

After seeing SPLIT IT I was mightily impressed. It's not easy to find a way to add value for Facebook users. From SPLIT IT, I linked through to their Money Lounge, and I was floored. They have job postings, videos, offers, all sorts of ways to engage the Facebook audience. Scrolling down, I noticed that they have 1,480 members of their group. Even if many of the group's members are employees, it's still an impressive engagement metric.

Money Lounge

Money Lounge 

So, well done TD Canada Trust! The first bank to build its own Facebook app.

William Azaroff is the interactive marketing & channel manager at Vancity where he develops interactive marketing initiatives, and pioneered ChangeEverything.ca, the groundbreaking change-themed online community. William also plans strategy for the online channel, with a view to its potential to help Vancity, its members and the community. William brings nine years of experience in Vancouver, Seattle and Los Angeles producing Web projects for such clients as Honda, Disney, Intuit Canada and Nike Jordan. He writes about the intersection of online branding, social media and the world of banking on his blog at azaroff.com/blog

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Buxfer is First Banking App to Tap Amazon Flexible Payments System

By Jim Bruene on August 3, 2007 9:53 AM | Comments

Today, Buxfer added funds-transfer capabilities to its online personal finance app (see announcement here, previous coverage here). The service is free through the end of August, but could eventually carry 1% to 2% fees to cover transaction costs.

Buxfer co-founder Shashank Pandit has been dangling this bit of news in front of me for the past two weeks. But he would only tell me that they were partnering with a big player to enable funds transfer (note to Amazon attorneys, he did NOT violate the NDA). I figured it would be Chase, Wells Fargo, or perhaps PayPal. Even with the rumors this week of Amazon's new payment services, I hadn't put 2 and 2 together.  

This morning it all makes sense. Amazon.com announced a potentially disruptive payment service, aptly called Flexible Payment System (FPS). And it's announced, in what else, a lengthy blog post at the Amazon Web Services blog (see note 1). The FPS website is here. The company even built an FPS Sandbox where users (see screenshot below), both individuals and companies, can play with the service without moving actual money around.

Buxfer is using Amazon Payments to allow users to settle their debts electronically, a vital piece of a social personal finance app. Online personal finance without payment capabilities is like the Internet without email. Even if the company ends up charging a small fee, the convenience would be worth it for many users. 

Implications
The Amazon service potentially makes it easier for smaller Web-based companies to take on traditional financial institutions. It won't alter the payments landscape overnight, like PayPal did in 2000, but it could usher in a rash of new entrants competing with banks and credit unions for the high-end personal finance customer (note 2). But the big stumbling block: consumer trust still favors incumbent financial institutions. In any event, the game just became more interesting. For more information, see Online Banking Report: Social Personal Finance.  

Buxfer homepage noting Amazon Payments

My default account page at Amazon's payments sandbox (I have not made any transactions, so the ledger is empty)

Note:

1. The post is signed by Jeff, which is Amazon evangelist Jeff Barr, not the slightly more famous other Jeff (Bezos). 

2. Another company using Amazon Payments is FreshBooks, a small-business billing service.

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Are New Online Personal Finance Sites Safe?

By Jim Bruene on July 20, 2007 3:18 PM | Comments (3)

A commenter yesterday asked if anyone had heard of BudgetPulse, an online personal finance site that opened its public beta site two weeks ago.

Well, we hadn't heard of it, but in this increasingly crowded space, that's no surprise. We are now tracking more than 20 online personal finance sites (previous coverage here). With low-cost server space, easier programming tools, APIs, and cheap viral marketing through blogs and social networks, the barriers to entry are a fraction of what they were just a few years ago. A good programmer could put together a simple financial tracker in their spare time.

While this will spur creativity and innovation, ultimately benefiting end-users, there is a downside. Security and privacy.

As we looked at BudgetPulse, which at first glance looks like several other Web 2.0-inspired finance sites, we couldn't help but wonder who was behind the site. There are no names, personal or company. Even the who is info for the domain is masked (domain registered in April). The only email address is disguised in spam-defeating format: "info (at) budgetpulse.com". Right now, the public portion is a two-page website with a few popup forms. The FAQs are empty. The forum is coming soon. There is a blog, but it only has three short posts. And there are misspellings in the website and blog copy. The websites entire security discussion is a single sentence:

We protect your account and data with advanced security methods.

More than likely this is simply the work of one individual who concentrated on coding the functionality first, and whose day job prevents him/her from spellchecking their HTML. But what if it's a scam? Convince a few people to use it to track their finances, then hit them with requests for their credit card numbers "to enhance the experience" or to their checking account number for payments, e.g., "Join our beta test and earn $500/mo as you test it."  

I admit that could be far-fetched, and I have absolutely zero knowledge of that happening at BudgetPulse or any other site. But it does bring up the bigger issue of consumer trust at independent, non-regulated personal finance sites (i.e., non-financial institutions). Even the well-funded personal finance sites such as Wesabe and Mint must deal with the mistrust and skepticism consumers have for new companies wanting to get involved in their lives, especially their finances. 

The solution: Financial institutions, with their trusted brands, partnering with or acquiring online personal finance sites to bring new functions and features to their customers.       

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Top-10 Facebook Money & Banking Applications

By Jim Bruene on July 13, 2007 6:38 PM | Comments (2)

 

After six short weeks, there are 48 applications in Facebook's Money category. At Netbanker we are most interested in the 14 directly related to banking, payments, and lending. So here's the most-used list with the stock trackers, calculators, and shopper apps removed. Lending Club continues to lead the pack as it has since its May 24 launch in conjunction with the new Facebook platform. Applications are listed by number of Facebook users that have added them to their profiles.

Top 10

1. Lending Club by Lending Club >>> 11,012 users

Lending Club enables those in the Facebook community with good credit to easily borrow from each other with a trusted third party managing the process and assessing the risk. Previous coverage here.

2. Fantasy Banker by Prosper >>> 4,674 users

Prosper bills Fantasy Banker as a twist on HOT or NOT, "a fun & educational way to get acquainted with person-to-person lending by betting on whether real-life Prosper loan listings will fund or not." Previous coverage here.

3. My Bucks By Aryeh Goldsmith >>> 3,926 users

A virtual currency called the Facebuck.

4. BillMonk (Obopay) by Charles Groom and others >>> 2,793 users 

BillMonk is an expense tracker specifically designed to track debts and obligations (such as rent) between individuals. Used Facebook APIs long before the F8 platform was announced. Previous coverage here.

5. Buxfer by Shashank Pandit and Ashwin Bharambe >>> 1,482 users

Buxfer is another expense tracker specifically designed for singles sharing households expenses. Previous coverage here.

6. Pay Me by Yellow Media >>> 842 users

Pay Me was developed by a third-party developer to make it easier to initiate PayPal payments right from Facebook. Previous coverage here.

7. ChipIn by ChipIn >>> 830 users

ChipIn is a simple way to collect funds for an event, trip, or anything. Users create a clickable badge that is displayed in their profile. Other Facebook users chip in via the PayPal network. Previous coverage here.

8. PayPal by PayPal >>> 500 users

The official product from PayPal, the division of eBay. So far, merely allows you to easily request money from your Facebook friends. More functions are said to be on the way. Previous coverage here.

9. Ven by Hub Culture  >>> 154 users

Another virtual currency.

10. iSpend by Reman Child and Shawn Gupta >>> 141 users

A new financial tracking app posted last week. 


The Rest
11. Wesabe by Wesabe, Inc. >>> 104 users

The Wesabe Facebook app currently supports group discussions. It is not currently linked into its Web-based personal finance app. Previous coverage here

12. OmniSpense.com by Jonathan Kelly >>> 60 users

The newest expense tracker, appeared in the money category in the past 48 hours, but looks like it may have been posted about 2 weeks ago. 

13. BillTrack Bill Reminder by Michael Irizarry >>> 59 users

Bill Track is built specifically for tracking bills (surprised?). It was posted earlier this week. 


14. My ViCu by Myvicu Master >>> 17 users

Yet another virtual currency.

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PayPal Launches on Facebook: Who Wants to be the First Bank?

By Jim Bruene on June 22, 2007 10:42 AM | Comments

The social networking phenomena has entered a new phase: eCommerce. It has always been a bit hard to visualize mainstream businesses, like banks, book sellers, or phone companies making a profit on MySpace. It's been a great place for musicians and online dating companies to grab market share, but a MySpace Checking Account didn't seem just around the corner (see MySpace coverage here).  

All that changed May 24, when Facebook opened its network to outside developers, making its service more like Windows than MySpace. Already the service has grown by 3 million users, more than 10%, in the past 4 week, to 27 million (see Facebook profile in today's Wall Street Journal).

More interesting are the 893 new services have opened their doors on the platform. The most popular, Top Friends by Slide, already has 6.4 million users. Yes, that is no typo, in one month a Facebook service grew to more than 6 million users. With traditional marketing, it would have cost a bank or card company as much as $1 billion to attract that many customers assuming acquisition costs of $100 to $150 per new account. 

And it's not just the one app. A new Seattle-based music preference service, iLike, has added 3.8 million. There's not a whole lot happening in commerce apps YET, the first financial company with a service offering, Lending Club (see previous coverage here), is the most popular business app, with just under 10,000 users. That's about what iLike attracts in a busy hour, but for a financial services company, and especially a startup, that's huge, a grand slam using tired baseball metaphors.

For many reasons, it takes longer for traditional companies to pounce on new opportunities. But over the summer we'll start seeing hundreds of businesses launch on Facebook. By next year at this time, the Facebook apps directory will probably look like the New York City Yellow Pages (or at least San Jose).  

Financial Institution Opportunities

Searching the site, we only see four financial services that have launched on Facebook:

  • Lending Club's person-to-person loan marketplace
  • Prosper's lending game
  • Wesabe's personal finance groups
  • Pay Me, a payment service developed by Australian Ad Agency, Yellow Media using the PayPal engine (screenshot below, we'll provide more details once we finish testing it)

But so far there is no:

  • Bank
  • Credit union
  • Credit card issuer
  • Mortgage lender
  • Brokerage (although there are several stock monitoring service including Forbes, Yahoo, and Social Picks)
  • Rates tracking service
  • Credit report monitoring service (though Identity Guard is advertising heavily today)
  • Identity theft protection service

Let the race begin. But you better move faster than you've ever moved before, if you want to get the huge first-mover advantage on the Facebook platform. Good luck.

For more information, see our latest Online Banking Report, Social Personal Finance.

Pay Me on Facebook using PayPal

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Wall Street Journal Publishes Roundup of Social Personal Finance Sites