moneyStrands is an online PFM tool that is available to consumers online. While moneyStrands offers a slick, easy-to-use site, it is but one of many players battling in the crowded PFM space. Its largest differentiator is that it boasts BBVA as a client (BBVA also invested US$24 million in the firm in December 2007). This large bank client is a great jumping off point for the firm to market its offering to other banks looking for a PFM tool. This has apparently payed dividends as on June 30th, Strands announced that it has signed up ING in the Netherlands. The offering is currently in private beta at ING. This is clearly a major win for the firm. My first experience with Strands’ moneyStrands product was at the Finovate Startup conference in late April (see blog entry). Strands has also been profiled in our recently published report, Financial Technology Startups: Giving Banks a Run for Their Money.
June 18, 2009 by 2 Comments
At the end of April I had the opportunity to attend Finovate Startup in San Francisco. I already blogged about my experience the day after returning. I also decided to writeup a report on financial technology startups – that report will be coming out next week. I decided to produce the report because much of the competition (to banks) and innovation in the financial services sector is coming from non-banks. The report singles out the innovative startups that Celent believes will have an impact on the banking space and/or the consumer market (many of these startups bypass the bank channel and market their products directly to consumers). Celent has selected the following companies to profile in this report:
May 21, 2009 by 2 Comments
It was an interesting and dangerous week in the PFM space. I have been talking about the security risks and data privacy issues of PFM for some time and unfortunately my predictions have come true. This is what happened:
- Rudder experienced what I would consider to be a serious data breach. Certain Rudder users were able to see the account information of other users. Twitter and the blogosphere were ablaze yesterday with details of the breach. A good summary can be found on the TechCrunch blog. This is a serious blow to Rudder and the entire consumer direct PFM space. This is an inexcusable gaffe and one that will have folks questioning whether they should be providing their account info to these sites.
- Mint.com may begin to sell “anonymous” consumer data (This Bloomberg article sums it up). This will raise the eyebrows of many users and I believe it is a privacy violation. Banks have all kinds of “anonymous” data on their consumers but they can’t just turn around and start selling it (they would likely get shot down by regulators).
May 13, 2009 by Leave a Comment
PFM is an Integral Component of Online Banking – Digital Insight and Metavante are on The Right Track
Interesting happenings in the PFM space yesterday. Digital Insight announced an agreement with Metavante that would enable Metavante to offer Digital Insight’s FinanceWorks to its online banking customers. I’m a big believer in integrating PFM with online banking so it is nice to see the traditional online banking solution vendors take the next step. Digital Insight has been selling FinanceWorks like hotcakes – More than 160 banks and credit unions currently offer or are in the process of launching the solution. There are a couple of reasons why the Digital Insight/Metavante deal is significant:
- Credibility and Proven track record. Digital Insight and Metavante have been in the online banking space for eons. They have experience with online banking solutions and have acknowledged the important role played by PFM.
- Integration Experience. There are a few consumer-direct PFM players (e.g. Wesabe, Gezeeo) that have announced that they will market their product to financial institutions (see the following blog entry). While they have very viable and competitive offerings they don’t have experience integrating with online banking solutions. This will however change as these vendors continue to sign up additional financial institutions. They will give the traditional OLB players a run for their money.
April 30, 2009 by 4 Comments
I had the opportunity to attend Finovate Startup in San Francisco earlier this week. It was a great event with a slew of fintech companies showcasing their wares to the captive audience. Each company was given 7 minutes to live demo their product – not an easy task. I’m very much a hands-on person so I appreciated this format. The demos were great and I got a pretty good feel for each firm’s product. The audience was a mix of vendors, press, analysts, financial institutions and VCs. I was surprised and disappointed to see how few banks were in attendance. Only 17% of the attendees were from financial institutions, and 40% of the FI attendees were from a single institution. Banks need to do more with regards to innovation and this event is a perfect place to learn more, and formulate thoughts and ideas. It’s also a great opportunity to look for vendor solutions that will improve feature/function, customer experience and overall competitiveness. While many of the startups offer their solutions directly to consumers on the web, there are a good number of firms that would be quite happy to sell their product to a bank. Some takeaways and trends from the show: PFM is where it’s at. I was amazed at the number of PFM solutions that were showcased at Finovate. Vendors include, moneyStrands, Wesabe, Mint, Jwaala, and greensherpa. I am a big proponent of PFM (see the following blog entries ) and was happy to see the emphasis. However, the market cannot sustain this many vendors and some will have trouble staying alive. PFM is expanding beyond budgeting and tracking. A number of vendors (Mint, greensherpa, Rudder, and Simplifi) demonstrated solutions that provide a picture of a consumer’s financial health/viability and financial planning. Grades/rankings are provided and customers can see where they need help and can plan for the future. BillShrink demonstrated an impressive solution that can help consumers save money on their wireless bills, gaz, and credit cards. Lending related solutions are gaining popularity. Tight fisted banks are driving consumers to a variety of places and P2P lending companies are capitalizing on this. Vendors here include, Prosper (now reopened), Lending Club, People Capital, and Pertuity Direct. Other vendors showed off lending and credit related offerings. These include Know Before You Apply, Credit Karma, Home-Account, ZimpleMoney, and SmartHippo. Payments offerings. A number of companies had payments solutions – SmartPay, HomeATM, Moneta , and Tempo Payments. Mobile Solutions. iPhone apps were the talk of the town (some live, some in development). Mobank demonstrated a neat e-commerce iPhone app. Not enough emphasis on security. Only 2 security vendors were part of the mix. Aradiom with a soft token for mobile phones and mobile banking, and Silver Tail Systems with their forensics solution. I was worried about the security of some of the solutions that I saw at Finovate. One vendor, Tempo Payments actually showed a form that contained a full SSN – not something you ever want to request or display online! The audience was given the opportunity to vote for best of show. BillShrink, Prosper, Silver Tail Systems and Simplifi were selected (in no particular order). Look for an upcoming Celent report authored by yours truly that examines the fintech space and what it means for banks.
March 18, 2009 by 8 Comments
Wesabe announced today that they will start to sell their PFM offering (dubbed Springboard) to banks and credit unions. Wesabe is not the first vendor to start selling directly to banks. Earlier this year, Geezeo made a similar announcement. These are win-win moves for both the banks and the software companies: – Bank PFM tools cannot compete with the rich solutions offered by non-bank providers. They need to update their offerings in order to remain competitive and keep clients attracted to their sites. For more info see my post on PFM Meets Social Networking. – The non-bank PFM providers have been struggling to make money. Their products are offered free of charge to consumers and their online business models are questionable. Direct sales to banks will provide a much needed revenue stream. Expect to see more of this trend as we move forward. It will be interesting to see how this software will affect PFM usage growth at the banks.