Your nifty personal financial management (PFM) tool may soon become much more useful. Yodlee, the developer of an account-aggregation platform used widely in the financial industry, will now offer a service that lets consumers pay bills and move money within a PFM tool.
Called Yodlee MoneyMovement, the transactional platform can infuse current PFM tools with the ability to offer account-to-account funds transfers, person-to-person (P2P) payments and bill-pay capabilities. The platform can also be integrated into a mobile environment.
Yodlee powers money management services for more than 35 million consumers at more than 150 of the biggest financial institutions and companies, including 32 of the top 50 U.S. banks.
Bank of America’s My Portfolio and Citibank’s Citi Financial Tools are examples of in-house personal financial management tools that use Yodlee’s account aggregation platform. Customers can link accounts from other financial institutions to establish a one-stop review of their money situation.
Although these tools may be a valuable service, they are not used by the majority of banking customers. According to a February comScore study, only 12.1% of Bank of America’s 29 million online banking customers use MyPortfolio. Such PFM tools have been criticized as well-intentioned, but lacking the functionality that would let users better manage their finances. In other words, PFM tools help users understand their finances, but don’t let them actually do anything about it.
Yodlee’s initiative could change that. If, for example, Bank of America’s My Portfolio is enhanced with Yodlee MoneyMovement, a Bank of America customer would be able to make a payment toward a Chase credit card from within the PFM tool.
“We believe that PFM and payments/money movement should be a tightly integrated experience, so consumers can not only understand their finances but also act upon them (pay a bill, move money, open an account, etc.) in a single, secure, integrated money management experience,” said Melanie Flanigan, a Yodlee spokesperson, in an email.
More power to PFM tools
Various independent PFM tools may also benefit from Yodlee’s transactional platform, especially as PFM tools are introduced every day with their own unique flavors.
Launched in February, SpringCoin is a debt-focused PFM tool that uses Yodlee’s account aggregation platform. Acting as an automated credit counselor, the tool establishes a debt-repayment plan based on financial and debt accounts. However, SpringCoin users cannot pay down their debt through the PFM tool. With the ability to make transactions, SpringCoin could upgrade the user experience and boost the effectiveness of its programs.
There are financial institutions and companies that are signed up for the Yodlee MoneyMovement platform, but Flanigan declined to name them, citing confidentiality agreements.