Trio of Big Banks Jump On PFM Bandwagon

The trend is clear. Online personal financial management tools (PFM) are quickly becoming one of the most popular innovations deployed by retail banks and credit unions. Earlier in 2011, Bank of Montreal launched its MoneyLogic PFM platform, joining a host of other financial institutions who have forged ahead: RBC’s myFinance Tracker, Suncorp’s Budget Tracker, Stanford FCU’s MyMo, Unitus Credit Union’s Total Finance and many others.

A survey last year from Yodlee found a strong appetite for online PFM services, with a quarter of respondents saying they would consider switching banks to get them in one place, but 65% were unaware that such a product even exists. Yodlee currently has more than 200 financial institutions, including Citibank and Bank of America, touching around 26 million consumers.

A 2010 Fiserv study found that Americans prefer to access PFM tools though bank sites. In a survey involving some 3,000 participants, 44% of current PFM users would not have been comfortable if they had known that their IDs and passwords were stored by a third party (such as Mint).

In one case study from Lodo software, PFM users at one credit union had an average of 3.7 accounts vs. 3.4 for non-PFM users vs. 3.1 for offline members. PFM users generated $2.1 million in annual profit for the credit union, 12% more than the profit earned from non-PFM users, and 45% more than offline members. PFM users also logged in online twice as often as others.

According to Lodo, the same experience has been reported at BBVA, where PFM users spend twice as much time on the bank’s website as nonPFM customers.

Sometime soon, “PFM becomes online banking,” Jacob Jegher, a senior analyst for Celent told US Banker. “From a relationship perspective, PFM will be the most important” thing for banks.

Wells Fargo – My Money Map

My Money Map is Wells Fargo’s free interactive online tool giving customers a dashboard view of a customer’s financial picture using data from their Wells Fargo accounts, including their credit card, debit card, checking and savings accounts. My Money Map’s interface has bar charts showing monthly spending by category, current savings and monthly spending vs. budget goals. Totals are automatically updated daily.

A young, likable spokeswoman walks through a thorough 4-minute video demonstration.

Wells Fargo has $1.2 trillion in assets, 10,000 branches, 17.9 million active online customers and 4.1 million active mobile customers.

Lloyds TSB – Money Manager

Money Manager is Lloyd TSB’s free internet banking service that tracks spending and aggregates data for personal checking and credit card accounts. It automatically breaks down spending into categories such as entertainment, food and travel. It displays graphs providing a more robust picture of where customers’ money goes. The bank promises to pre-populate Money Manager account with up to two years of spending data. Lloyds TSB announced Money Manager on February 1, but over one month later, the service is still unavailable.

A short, animated video presentation touting the benefits.

Visa – VisaNet

This service provides Visa account holders with a mobile SMS text, email, and online spend management tool that allows them to set a purchase threshold for various accounts, monitor their spending in certain categories, and alerts them when their aggregate spending exceeds pre-set levels. Visa’s service is offered to account holders through participating financial institutions, and applies to credit, debit and prepaid accounts.

Account holders can select the spending categories they wish to manage, such as grocery, entertainment or restaurant spending. They can set budget levels for each spending category over a specified time period — daily, weekly or monthly. They can also choose how they would like to be notified when a threshold has been reached. Notifications can be delivered via SMS text messages or email.

PNC Bank has been piloting the new VisaNet services within its Virtual Wallet product, an online money management tool developed in 2008.

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