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Published by: TowerGroup
Published: Jun. 23, 2008 - 8 Pages
Table of Contents
- Report Coverage
- Background
- The Good
- The Bad
- The Ugly
- The Future
- Summary
AbstractTowerGroup Take-Aways
- Online personal finance sites combine traditional account aggregation services with Web 2.0 concepts to perhaps finally enable users to find meaningful value in account aggregation.
- TowerGroup estimates that online personal finance sites now serve approximately 750,000 registered users.
- Fortunately for banks, online personal finance sites do not yet offer the transactional capabilities necessary for consumers to either move their financial relationships or use the sites as their primary financial center.
- Unfortunately for users, online personal finance sites have an egregious security flaw: the use of a simple username and password to access the sites and retrieve 'their extensive financial information.
Because online personal finance sites are not regulated, there is no way to fully ensure that their security and privacy policies are indeed adequate and, more important, are being properly followed.
Report Coverage
Several new, nonbank Web sites are now providing account aggregation services directly to consumers. The providers of these online personal finance sites may have finally found a way to offer meaningful value in account aggregation by layering in personal financial management (PFM) tools (e.g., transaction categorization, budgeting tools, and financial planning advice) with Web 2.0 concepts (e.g., social networking, spending comparisons, and merchant ratings). A key missing ingredient, however, is the presence of adequate fraud prevention capabilities to protect consumers and banks from account takeover and identity theft. This TowerGroup Research Note explores the consumer benefits, bank impact, and security issues with these new online personal finance offerings.
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