Banks are offering personal
financial management tools
(PFM) online and on mobile
to help their customers get
a better handle on their
spending and saving.
12 | ABa BANK MARKETING | SEPTEMBER 2012
Help Me
Track My
Money!
W
By Deb Stewart
hy should banks provide personal financial management (PFM) tools online and on mobile?
“When consumers lack information on their money, they’re not in
a position to save, to spend or to invest,” notes Mark Schwanhausser,
senior multichannel financial services analyst at Javelin Strategy and Research, Pleasanton, Calif. “They can’t assess where they are today and they can’t move forward.”
Photo Illustration © C.J. Burton/Corbis
In a 2011 study, Javelin discovered that 14 percent of consumers (17 percent of
Gen Y) do not manage or monitor their finances. This segment had nearly doubled
since 2009.
Banks can help solve this customer problem by offering PFM tools and, in the
process, the banks potentially differentiates themselves and become more valued
financial partners, Schwanhausser adds. “Putting personal financial management
tools at the heart of online and mobile experiences will keep information in front of
your clients and create a daily conversation between you and them.”
So what is PFM? From the perspective of consumers, it’s the ability to have access
to the information they need to track, understand and manage their financial lives.
From a banker’s perspective this translates to core functions that enable customer to:
m See all of their accounts at a glance. They can view balances and transaction summaries from one institution or aggregated from all the customers’ financial service
providers.
m Monitor spending. They can see where their money is going by category and
compare that to their planned budget. They can analyze underlying transactions
in each category.
SEPTEMBER 2012 | ABa BANK MARKETING |
13
Wells Fargo & Co.
A screen view
of Wells Fargo’s
proprietary
personal financial
management tool,
called my Money
Map. The ancillary
tools, Budget Watch
and My Savings
Plan are for the
bank’s credit card
and saving account
customers.
m Set budgets. They can plan spending by category—housing,
groceries, entertainment—whatever makes sense for each
customer.
m Monitor cash flow. They can see dollars moving in and out
of accounts and easily determine what is available to spend.
m Set and monitor savings goals. They can plan specific dollar
goals and timeframes and monitor progress toward those
goals.
m Optimally integrate all of these features with bill-payment,
transfer and other online banking capabilities.
Third-party providers such as Mint.
com, Strands Personal
The good news for banks is that a
Financial Management
recent study indicated that 75 percent of
and Yodlee have done a
great job of addressing
consumers would like to use their primary
most of these consumfinancial institution for PFM.
er requirements, with
Mint.com currently
reporting 9 million
registered users. “The
good news for banks is that a recent study indicated that 75
percent of consumers would like to use their primary financial
institution for PFM,” says Peter Wannemacher, senior analyst at
Forrester Research, Cambridge, Mass. “Banks have done such
a good job of educating consumers to protect their private information that they are reluctant to share account information
or passwords with any third party.”
Let’s look at two approaches taken by banks to address
this product category: PFM tools that are developed by the
bank in-house, and tools that are supplied by a third-party
software supplier.
14 | ABa BANK MARKETING | SEPTEMBER 2012
Wells Fargo & Co. (assets: $1.1 trillion),
San Francisco, was an early bank entrant
to PFM, developing and introducing
its first offering in 2005. Its current My
Money Map product was launched at
the end of 2010. This product builds a
comprehensive financial view for customers by leveraging earlier offerings:
My Spending Report, Budget Watch
and My Savings Plan.
“The My Money Map product is a
tangible demonstration of the Wells
Fargo brand promise—it is a great tool
to help make our customers financially
successful,” says William Robins, vice president
of PFM at the bank.
“We recognize that each of our customers
is in a different place, trying to get to a different place,” says Robins. “So you can reach My
Money Map through a primary tab in online
banking, from product account summary and
account activity pages—in ways that work for
that customer. We’ve seen that customers want to manage their
money with different levels of rigor, and the various features
of the product allow us to meet the customer where they are.”
My Money Map is an automatic feature of online banking.
My Spending Report and Budget Watch are online features
for any checking account or credit card customer, while My
Savings Report is available for anyone who has a Wells Fargo
savings account.
Robins says that more casual users tend to like My Money
Map, while more rigorous money managers who may have
used Quicken or some other PFM software in the past prefer
My Spending Report.
All elements of Wells Fargo’s PFM were developed by
the bank. Some components of My Spending Report have
been patented.
A key benefit of internal development is that each feature
is completely integrated with Wells Fargo online banking.
Customers can transfer funds, pay bills, conduct all online banking functions within the My Money Map module.
The “dashboard” look, tone and feel of the My Money Map
product is also seen in the bank’s Envision online wealth
management tool.
“While My Money Map supports all the basic activities
that the mass market needs to do regularly to manage their
money, Envision is a long-term financial management tool—
generally introduced through an in-person meeting with a
financial adviser,” says Robins, “but both are presented in a
clear, easy to understand fashion.”
As My Money Manager is introduced into various markets,
the bank gives it comprehensive media coverage including TV,
radio, outdoor and online (for example, Wells Fargo Twitter
handles, Wells Fargo blogs and a public website). Since the
product is so well aligned with the bank’s brand promise,
it does not require a high degree of media support. Branch
bankers are a key part of the ongoing sales process. Branch
bankers are provided with tools specific to their prominent
branch demographics that enable them to sell checking,
credit cards and savings in a more meaningful way using
My Money Manager.
“Since the product delivers so directly on our brand promise, we do believe that it impacts acquisition,” says Robins.
“My Money Manager customers are more likely to stay with
Wells Fargo, and elements like My Savings Report facilitate
share-of-wallet growth. So branch associates clearly see the
benefit of introducing their clients.”
Robins says the next addition to the tool is expected to be
short-term cash flow modeling. This feature is being developed
because of a recent Career Builder study that indicated that 78
percent of Americans live paycheck to paycheck. And this is
true for 30 percent of Americans earning $100,000 or more.
“We want to enable these customers to see clearly where
they are and how they might better manage their money—so
short-term cash flow modeling will be available in consumer
tests shortly. We are seeing that the emergency savings category is a commonly selected goal (along with vacations) in
Savings Manager. By providing the right information and
tools to save, we can really help consumers become more
financially secure.”
The bank is also assessing the possibility of making the
product more functional for mobile devices.
Is the bank planning to offer aggregation? Robins says,
“Some customers want it and many are nervous—they have
heard the message of keeping user names and passwords se-
cure.” The bank is also examining the question of servicing:
If a consumer is accessing third-party information or doing
transactions through the bank site, whom do they call to
service the account? “We need to be sure we’re delivering on
the promise of convenience—being able to see information
and take action—so we feel there are many questions to be
answered before adding this feature.”
Robins’ advice to other bankers who are thinking of adding
PFM tools is to make a commitment to the offering. “Continuous marketing, promotion and working with the retail
sales force are needed to make it successful—and that takes
commitment from all levels of the organization. It doesn’t
happen at one time; it needs to sit at the core of your retail
activities.”
The FinanceWorks dashboard-like experience puts a summary
of the customers entire financial picture on their online
banking homepage.
A third-party model
For banks that do not opt for internal development of their
PFM, Intuit FinanceWorks is the chosen solution for more
than 500 financial institutions and is available to nearly 11
million online banking users.
FinanceWorks allows transactions to be
made directly from the bank’s home page—
ensuring that customers are associating PFM
These are sample screens showing Intuit’s FinanceWorks, a third-party
personal financial management tool used at about 500 banks.
SEPTEMBER 2012 | ABa BANK MARKETING |
15
benefits with their bank, not an outside company. Intuit is
also the owner of Mint.com, a third party PFM, a product
targeted to customers who do not choose to access information through a bank.
The FinanceWorks dashboard-like experience puts a summary of the customers entire financial picture on their online
banking homepage. These summaries include information from
the primary bank as well as accounts from other institutions
that the customer has elected to add.
Summary categories include:
m Financial position: Provides account information from the
primary bank and from 18,000 other financial institutions and
creditors (if the customer chooses). These include traditional
checking and savings products, investments, and loans. These
are automatically refreshed nightly. The customer can refresh
“real time” when they are using the system. Customers can
also add assets such
as cars, collections,
real estate and others manually.
m Where is my money going? Summarizes the customer spending by “auto categorizing” transactions with a categorization
engine. These transactions include those from aggregated
financial institutions. Customers can choose to split or modify
transactions manually; for example, if they spend $200 at a
discount retailer they may choose to split that transaction
between groceries, entertainment, healthcare or others.
m Am I making my goals? Tracks the customer’s progress against
their set spending goals and alerts them when they are close
to or have exceeded their targets. These can also be sent as
alerts to an email address.
m Reminders: What bills are coming up in the next week?
m Rewards: Allows banks to add merchant funded rewards to
the summary page linking consumers’ debit card purchases
from various merchants with competing deals or moneysaving opportunities. The customer just clicks on the offer
to activate and when they swipe their card at that merchant,
the award amount is credited back to their account.
Consumers using FinanceWorks access their
financial institution 56 percent more often
than those not using the system.
Personal Capital is a
new personal financial
management tool that
focuses on wealth
management, including
managing 401(k) assets and
other investments.
16 | ABa BANK MARKETING | SEPTEMBER 2012
Each of these categories also provide access to the underlying
data—so consumers can see trends in spending by category or
in their overall financial position. This access makes the system
an even more powerful tool for ongoing financial management.
“Consumers using FinanceWorks access their financial
institution 56 percent more often than those not using the
system. They conduct 25 percent more debit transactions. We
believe this is due to having greater confidence in
knowing their financial position. And we know
that FinanceWorks users are 1.3 percent stickier
than nonusers in any given year,” says David St.
Geme, associate product manager at Intuit.
“Bank and consumer feedback indicates that
the aggregation piece truly delights consumers—although awareness is still low. Seeing their
whole financial picture across institutions simply
and all in one place gives the consumer greater
confidence—it transforms they way they look
at their money. And we are working to bring
this information to them across devices—PCs,
mobile, tablets—what they want to know, where
and when they want to know it,” adds St. Geme.
It is important to understand that the primary financial institution does not have access
to customer-level data from other institutions.
They do have access to aggregated data on their
customers’ other accounts, which can be used for
targeted marketing messages to these customers.
MoneyDesktop is a third-party personal financial management tool that expands
beyond financial history by helping customers build specific plans to achieve
their financial goals—such as getting out of debt or saving.
The exciting element to this product is how
fast we expect it to evolve.
BancFirst, Oklahoma City, Okla.
BancFirst (assets: $5.4 billion) Oklahoma City, Okla., has provided FinanceWorks to its customers since 2009. “Leveraging
the Intuit brand—FinanceWorks powered by Quicken—gave
us immediate legitimacy in this market,” says says Blane Allen,
senior vice president, financial services. “Even customers who
have never used the Quicken product consider it the best in breed
for managing money. The aggregation feature is being used by
most of our customers. We see customers begin by using the
transaction management features of the product, but quickly
move into the larger planning and management functions as
they become familiar with the capabilities.
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“Seeing the FinanceWorks summary on their online landing
page each time they log in makes this an integral part of the
way they manage their money. And customers are pleasantly
surprised when they learn that mortgage interest information,
charitable donations, business expenses and other items can be
automatically integrated into TurboTax,” says Allen.
“New enrollments in the product continue to be strong
with about 20 percent of our online base currently using the
product—this is just behind penetration of bill-pay with our
customers. The branch channel is the primary source of product introductions, introducing online banking, bill-pay and
FinanceWorks as a complete financial management suite. This
has become a part of our day-to-day selling, with a focus on
education and how products can help customers thrive in their
financial lives,” Allen continues.
BancFirst has used in-branch promotion, banners on statements, splash on the homepage and online banking pages to
continuously promote the product. They also highlight the
specialized applications to small businesses in business publication advertising.
Mechanics Bank, Richmond, Calif.
Mechanics Bank, Richmond, Calif., is a newer user of FinanceWorks, offering the product since April 2011. “As a $3 billion institution we had to decide how we would differentiate ourselves.
We have chosen to focus on engagement banking—tools and
services that will increase our level of dialog with our customers in meaningful ways. FinanceWorks brings the customer’s
aggregated financial data to the main online banking page in
a highly automated and personal manner—it’s a snapshot of
their entire financial life,” says Bradley Leimer, vice president
of online and mobile strategy for Mechanics Bank.
“Eighteen percent of our online base is using FinanceWorks.
And almost all of those are taking advantage of the account
aggregation features. We are leveraging the power of the brand
with the tagline: ‘Brought to you by the makers of Quicken,
QuickBooks, TurboTax and Mint.com.’ The exciting element
to this product is how fast we expect it to evolve. Customization
of look, tone and feel specific to our brand is expected shortly
as is access through mobile banking and tablets. Longer term
we feel it’s important for the customer to be able to personalize and customize their PFM experience,” Leimer continues.
What’s next?
Our bank users have identified the need to move to mobile
and tablet applications, the ability for customers to personalize
and customize their experience and for third parties to allow
banks to attach their look, tone and feel to the experience.
Leimer points to “if this, then that” as the next step—with
PFM developing real time recommendations based on financial
moves the customer is making.”
Some relatively new entrants to the market are adding
some interesting twists to the product offering. Personal
Capital, a best in show winner at Finovate 2012, is an online rich Internet application (RIA) with a focus on wealth
management, including managing 401(k) assets and other
18 | ABa BANK MARKETING | SEPTEMBER 2012
investments. The online platform combines digital technology with highly personalized service to provide a holistic view
of the customer’s unique financial picture. The free online
dashboard aggregates all financial data and presents it in one
place, including as assessment of allocation, investment risk
and fees. Clients with a minimum of $100,000 in investable
assets are eligible to receive highly customized financial advice
for a low fee. Users can also access this data from Personal
Capital’s free iPad and iPhone apps.
The unique aspects to Personal Capital’s offering include
the ability to transfer money between providers, real-time
analysis of the customer’s investment portfolio, and the ability
to use Facetime to “meet” with agents online.
MoneyDesktop currently has partnerships with 25 online
banking and payment network providers and 311 financial
institutions that license its PFM solution. Another winner of
the 2012 Finovate Best of Show award, this offering expands
beyond providing financial history and helps customers build
specific plans to achieve their financial goals—whether that
is getting out of debt, saving or something else.
A focus on “raising the user’s financial IQ” brings unique
planning capabilities to customers online, on mobile devices
and on iPad.
Nate Gardener, vice president of marketing at the company
states, “Our goal is to drive PFM adoption, and make financial institutions the financial hub for their account holders,
where the best financial tools and insights are available as a
core part of a bank’s virtual banking channels.
“MoneyDesktop realizes that consumer expectations are
changing at an increasingly rapid pace, and we believe that
banking has reached the point where data aggregation and
PFM can no longer be optional add-ons to online banking.
More than ever before, banks have the capability of offering
to account holders greater financial understanding by making
PFM a central and integrated part of the mobile and online
banking user experience.”
“In order for PFM to reach its full potential, a meaningful user experience is paramount. It has to entice the user
to frequent use, through a combination of action-oriented
functionality and sleek interactive design. Banks that can
elevate their online and mobile banking experience to that
level will not only create huge value to account holders, but
have a powerful competitive advantage over banks that do not.”
St. Geme of Intuit summarizes the future, “With the continued emergence of online and mobile tools across industries
and products, it is important that bank customers have access
to quality information anytime, and wherever they are. With
PFM products that are easy and intuitive to use, we have an
opportunity to transform the way our customers look at their
money—and at us.” n
About the Author
Deb Stewart of Charlotte, N.C., is an independent consultant working for the financial services industry. Telephone:
(704) 759-1633; email: DebLstew@aol.com.
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