I recently had the opportunity to attend the Net.Finance Conference in Chicago. It is, by far, one of the best conferences for those of us focused on the digital channels of financial services. Over the next couple of weeks, I'll be writing about some of the main themes from the conference.
When I was there, I was fortunate enough to be part of a panel discussion on Personal Financial Management (PFM) along with Patrick Smith of Wells Fargo, Eric Connors of Yodlee, and Edward Chang of Strands.
We had a lively discussion about the benefits of PFM for our customers, the challenges of getting people to use it, and the pros and con's of aggregation services. While the benefits are pretty clear (better financial management) the biggest challenge, as noted by Patrick, is inertia. Managing your finances is certainly important, but not critical. Setting up goals and budgets falls somewhere around cleaning out the gutters on the "to do" list. The key, perhaps, is to help educate the consumers about the benefits to make it move up that list.
One of the classic differences between my organization, a smaller community bank, and Wells is the approach to aggregation. Wells provides tools that help manage those accounts that are with Wells while we offer a service to add all your accounts, even from other institutions. Perhaps this highlights the major difference between big and small banks. We see this as a service that is the right thing for the customer, while they look at it from an internal perspective of what is right for the organization. We (of course) think ours is the better approach.