The challenge for PFM lies in seamless integration with OLB
The promise of Personal Financial Manager tools (PFM) for banks has been long predicted but slower to be adopted by customers. This has been a natural outcome because most if not all banks have taken the route of purchasing or partnering with software suppliers. The result has generally been as highlighted in this American Banker piece that PFM exists in a separate tab within online banking.
With most customers used to going straight to bill payment or transfers it is only natural that the PFM tab will get less use. Regions bank have introduced charts from their PFM offering that appear on the OLB home page.
To draw attention to the Insights tab, Regions provides online banking customers with pie charts of their transactions on their online banking home page, teasing to the Insights section to encourage the customer to click on it.
This has increased interest, but it seems to me that integration throughout OLB would be the real answer. That presents an infinite number of technology problems for banks unless they are prepared to modernise their OLB architecture to accommodate these new offerrings which are built with new technologies.
The other challenge which is an even greater hurdle is that the definition of PFM is far too broad and frankly irrelevant to the average consumer. This was evidenced by the original uptake of Quicken software which flatlined at something like 14% +/1. The idea that in effect taking a ‘Quicken’ type all inclusive offerring and making it a tab within inline banking and expecting it to have immediate uptake is of course absurd.
I, for one, could care less about pie charts or categories showcasing the ways in which I spend. I refuse such intimacy with my transactions. All I want to know is: am I spending more than I’m saving? In other words, let me have my Jameson indulgences if I’m prudent with my overall credit card spend. Categorizing my spending choices hinders my lifestyle choice. And yet, I’ll log into my digital banking a few times a week to ensure I haven’t lost my credit card mind. To me, logging into online banking is PFM. And it’s enough for now
Its just one journalists view in this other AB article but it makes the PFM discussion real. People trust and use their online banking, particularly using mobile now. Somehow PFM software needs to be able to make OLB come alive for clients without being PFM. It should just be OLB with PFM capability seamlessly integrated.