NetBanker 2.0

Bank of America is first major U.S. bank to integrate personal finance into online banking

Bank of America is the first major U.S. bank to provide full online personal financial management (PFM) within its online banking service. It's an important development and one we predicted in our detailed look at online personal finance (Online Banking Report #131/132, published in September). So, in conjunction with our sister publication, we are awarding it the fifth and final OBR Best of the Web for 2006 (click here for other recent winners).

The bank uses its Yodlee-powered My Portfolio account-aggregation service to deliver the PFM functions. BofA is the first financial institution to use Yodlee's new MoneyCenter module since its launch six months ago (see our coverage here).

The bank has chosen to offer the full MoneyCenter suite with Net Worth Summary, Investment Detail, Transactions, Rewards, Email, and Search on the main page (see screenshot below).

My Portfolio also includes basic personal finance functionality, including budgeting, categorizing and a nice array of preformatted reports including:

• Cash Flow Analysis
• Expense Analysis
• Budget vs. Actual
• Credit Card Utilization
• Get Transaction Reports
• Set Budget Goals

See Online Banking Report 131/132 for more details on Yodlee's MoneyCenter.

Analysis
Overall, we believe the new PFM functions are a great addition to the bank's online banking program. However, it still feels a bit "bolted on" to the core online banking service. For instance, My Portfolio does not yet warrant a place on the primary top navigation bar. Instead, users must click on a link in the middle of the main Account Overview screen.

Once the Yodlee-powered service has loaded (which took 10 to 15 seconds in our tests at broadband speeds), it's relatively well integrated. A second My Portfolio navigation bar is loaded under the main online banking navigation. Finally, a third row displays the options available for each function in row two (see screenshot below).

The pages load relatively fast as long as you stay within the My Portfolio area. However, moving back and forth between BofA-served online banking functions and Yodlee-served My Portfolio functions is a bit clunky with the 15-second delay. But the overall experience will be fine once My Portfolio is incorporated into primary navigation.   

The main My Portfolio page is automatically pre-filled with applicable BofA accounts; however, in my case, I was unable to update older credit card information. When clicking Update All Accounts in the upper right, error messages indicated that my Bank of America credit cards could not be updated (see screenshot below).

billQ uses account-specific RSS feeds for bill payment notices

For the past few months, I've been more or less obsessed with RSS feeds (see our latest full report on the subject here). All of a sudden every information-delivery problem seems solvable with a feed.

And there is enormous potential for feeds in everyday banking which primarily involves simple information queries: What's my balance? Did my check clear? Was my mortgage paid? 

The first account-specific financial feed
I've been on the lookout for the first financial institution with account-specific feeds. That search continues, but a non-bank has been using feeds for bill-payment-status updates: previous OBR Best of the Web winner billQ <mybillq.com> (see previous coverage here).

The company has an "RSS Feed" option on its list of automated bill-payment-tracking mechanisms which also include an iCalendar subscription, an Apple OS X widget, or a toolbar applet (see screenshot below for billQ subscription options).

When using the RSS feed option, bills automatically appear in the user's newsreader software. Below is an example using the Newsgator Web-based reader:

Top 25 Web 2.0 financial sites

Since its September launch,  Your Credit Advisor <yourcreditadvisor.com> has posted several trendy lists to attract traffic to its credit card application portal. The latest entry, "Top 25 Web 2.0 Apps for Money, Finance, and Investment."

The article includes helpful summaries of each site's capabilities. It's a good jumping-off point to do a little outside-the-box thinking about Web-based finance (see also, Online Banking Report #135/136, "How to Web-2.0 your Online Banking").

This list includes:

• Two loan sites: Zopa and Prosper (see previous coverage here)
• Six personal finances sites: Three we've covered: Dimewise, foonance, ioweyou (see our previous coverage here) and three new entrants: NetworthIQ, MedBillManager and Wesabe, a fascinating social money site we'll cover later this week
• Five real estate sites: Homethinking, iiProperty, Rentometer (owned by iiProperty), Trulia, and Zillow (see our Zillow coverage here)
• Two miscellaneous sites: PayScale, cFares
• Ten investment sites: BullPoo, Motley Fool's CAPS, DigStock, FeelingBullish, GStock, MoneyTwins (foreign currency), SaneBull, StockTickr, WikiFinancial

Intuit's billion-dollar online banking play

Intuit's bold move to purchase online banking pioneer Digital Insight came as a surprise, both to analysts and shareholders. Reactions were mixed, with shares drifting downward after the 8 AM EST announcement Thursday, ending the week off 3% (see chart here; Intuit presentation on the acquisition here).

Although the software developer has made a few forays into selling bank technology, including owning a bill payment processor in the mid-90s, it has generally stayed focused on packaged software for consumers and small businesses.

Just two weeks ago, I met with Intuit execs at the coming out party for its financial institution services unit at the China Grill down the hall from BAI's Retail Delivery Conference in Las Vegas. They were excited about several new services built on the Teknowledge unit purchased last year (see previous post here).

Analysis
Only time will tell whether the acquisition makes sense for Intuit. It's a savvy company that understands the personal finance space as well as anyone, so I tend to believe they know what they are doing.

Regardless of what it does for Intuit's share price, the merger is bound to shake up the online banking product offerings at banks and credit unions, especially for smaller businesses, the Quicken and QuickBooks crowd.

In September, we published a report predicting significant growth in personal finance functionality in online banking services (see Note 1). This merger should further accelerate that growth. As Intuit integrates Quicken, TurboTax, and QuickBooks features into the Digital Insight line, other platform providers will feel pressured to keep up.

This is good news for U.S. consumers who've generally NOT been able to enjoy the benefits of tightly integrated personal finance and online banking.

End Notes:

(1) See Online Banking Report #130/131, Personal Finance Features for Online Banking: Why MySpendingReport Trumps Free Bill Pay

Will Google create an online Quicken clone?

Google hit the news today with a modest improvement to its online word processing and spreadsheet services, combining them in an umbrella offering called Google Docs (see TechCrunch analysis here).

Clearly, the Web giant hopes to convert millions of casual users from Microsoft Office to its ad-supported services. If they make headway in word processing, it's only a matter of time before they offer more specialized software applications. One area likely to be seriously considered is personal finance management, dominated today by Intuit's Quicken and Microsoft Money.

It would be relatively easy for Google to jump into the market. For a few million, it could acquire one of the personal finance startups such as BudgetSnap (see Sep 12) or Foonance (see Aug 10). Or it could build a service by licensing Yodlee's MoneyCenter (see July 5).

Analysis
What impact would this have on financial institutions? For banks with basic "plain vanilla" online banking, it could be a major threat if users began storing their banking transactions at Google, especially if the company offered automatic pre-scheduled downloading, which is likely. Users would log in to their banks far less often, diminishing the opportunities to cross-sell and service customers. And with the transaction archives stored elsewhere, it would be much easier for consumers to switch banks, reducing the relationship value of online banking and bill pay.

To avoid being marginalized by online personal-finance services, banks should boost their feature-set to include basic financial-management features, such as payment categorization, long-term storage, and reporting. Consumers have little desire to store confidential information with a Web-based company; however, if you don't provide obvious features, such as transaction storage, users will look elsewhere.

For more information
Our previous coverage is here. And for those wanting a detailed look at online personal finance, read our recent Online Banking Report #131/132, "Personal Finance Features for Online Banking" (subscription required).   

BudgetSnap launches full-service multi-language personal finance app

Just when we thought we'd found all the online personal finance applications (see Online Banking Report #131/132), another one pops up, BudgetSnap <budgetsnap.com> from Walton, NY-based BudgetSnap LLC.

Feature-wise, it's a winner with support for not only budgeting, but also for tracking investments, credit accounts, bills and so on (see screenshot below). And right out of the gate it supports local currency and language across 14 countries and six languages (English, French, German, Spanish, Portuguese, and Japanese). There is also a mobile version in the works (see inset).

The company has filed for patent protection, but we haven't heard back on what portions of its service they are seeking to protect.

As with other standalone, personal finance apps (see previous FMW articles), we have serious doubts as to whether BudgetSnap can attract a critical mass of users without financial institution connectivity. The company appears to recognize this limitation and is actively pursuing partner relationships as evidenced by this statement tacked on to the bottom of its price list:

Educational, co-brand and white-label discounts available for qualified institutions. Please call (917) 865-4896 for more details.

Pricing
The company is offering a 90-day free trial plus price incentives (prices good through year-end):

1 Month @ $9.95 $7.96 - Save 20%!
3 Months @ $24.95 $19.96 - save 33%
6 Months @ $47.95 $33.57 - save 44%
12 Months @ $89.95 $62.97 - save 47%
24 Months @ $149.95 $89.97 - save 62%

The company has an additional incentive for two-year subscriptions, The Money Book for the Young, Fabulous & Broke by Suze Orman. Finally, students/seniors qualify for an additional 15% discount.

Facebook launches MoochSpot, a "social loan" tracker

In mid-August, Facebook, the popular social networking site aimed at college students, alums, and now a few select corporations has released a simple personal finance application. The original name was FaceBank (see screenshot at bottom of article), but recently it was renamed MoochSpot (click on screenshot below for closeup).

MoochSpot allows Facebook users to loan (i.e., spot), borrow (mooch), and settle debts with other Facebook users. At this point there is no payment capabilities, so the money must change hands through other methods.

Here's how it works:

1. Create a "piggy bank" to track the funds
2. Select a Facebook friend from the list that automatically shows in the MoochSpot list (note, in our screenshot below, we don't have any predesignated friends, so the list is empty)
3. Enter the amount of the loan
4. (Optional) Enter a reason for the loan

Analysis
MoochSpot was developed, not because of huge user demand to track personal debts, but to showcase the type of application that can be built by outside developers using the recently released Facebook APIs. MoochSpot is highlighted on the Facebook developer's page <developers.facebook.com>.

BIllMonk, the self-proclaimed "social money" site which allows debts to be split and tracked via website or mobile phone (see FMW Apr 30), is the first financial services provider to jump on the bandwagon and create Facebook integration (in inset, see Facebook login in lower-right of BillMonk's homepage). We tried on several computers to get it to work and were unable to get past the Facebook login. We'll check back in a few days to see if they have the bugs worked out.

Financial institutions looking to create online banking sites that click with college students should pay close attention to BillMonk and MoochSpot. It would be relatively simple for a bank to use the Facebook API to develop even more powerful payment applications that combine the loan-tracking benefits of MoochSpot with actual epayment capabilities to move money back and forth among friends. While it wouldn't do anything that Paypal doesn't do today, the integration within online banking is important.

But the biggest reason to integrate with Facebook, MySpace, or any other 20-something social network is because it positions yourself as a bank or CU that understands the younger generation. And make sure you have genuine 20-somethings designing the marketing and writing the blog copy.

Web-based calendar company for sale

In Online Banking Report, we've looked at online calendars as nice-to-have additions to banking websites. They fulfill a personal financial-management role by tracking and sending reminders of bill payment and other deadlines.

If you are interested in adding a calendar to your user interface, there is a unique opportunity to purchase a turn-key calendar website, that provides not only the code, done in a Web 2.0-like look, but also 40,000 monthly visitors. You could potentially pick up some customers from the existing user base as well.

The site, Kiko.com, is for sale in an eBay auction that ends on Aug. 26. Opening bid = $50,000.

Thanks to TechCrunch for the tip.

Foonance launches Web-based expense tracker

Foonance <foonance.com> is an online personal finance program with a Web 2.0 design. The free service is similar to Moneytrackin' (FMW Aug. 9), but with a much simpler URL and a more interesting design.

Users create "Money Stores" anywhere that cash is stored, and then add "in" or "out" transactions to track balances. Each transaction is tagged with multiple descriptors and a "tag cloud" can be used to access running balances in each category.

The company promises new features every two weeks, an unusual pledge. I'm not sure the average user wants that much excitement in their personal finance app, but it does have an appeal to the ultra-early adopter who'd be likely to give Foonance a try.

Banks looking to add personal finance functionality to their offering should take a look at how Foonance accomplishes relatively simple functions with panache.

--JB

Mo.neytrack.in' launches personal finance app

Launched May 16, Moneytrackin' <mo.neytrack.in> is a Web 2.0-inspired personal finance application from a Spanish developer. The free service, in public beta (looks more like alpha), has just one function, storing and categorizing transactions (click on screenshot below for a closeup). However, much more functionality is in the works (see blog here).

It's ultra-simple to use. Users can set up sub-accounts/projects on the fly then add transactions to each. Transactions can be "tagged" with as many categories as desired. A "tag cloud" runs on the bottom of the screen allowing users to click easily on any category to view the transactions. Finally, a pie chart shows a breakdown of expenses by tag.

The multi-language service is offered in English, Spanish, French, German, and in what must be unique in the personal finance space, Catalan, a Spanish dialect spoken by 10 million Southern Europeans.

For a complete run-down of personal finance functionality for online banking, check out our next Online Banking Report, available mid-August.

--JB