Some Thoughts On Where PFM Is Headed

January 28, 2015
Bryan Clagett

PFM is moving beyond a budgeting tool, in fact it has been moving in that direction for a long time. We're seeing PFM take on the position of a digital financial advisor, whereby data helps consumers and businesses make informed financial decisions as they pertain to goals and objectives. People want more than just help managing their finances, they want help achieving life goals. We are all driven by emotion and passionate about reaching certain milestones. Admit it. The vast majority of us are not passionate about maintaining a budget.

We're seeing successful financial institutions move PFM beyond just a budgeting capability within online banking. Instead, they are looking at the entire digital experience from a customer experience (CX) point of view. Empowering customers means getting to know them better, and this is where aggregation can help. For whatever reason, be it control, technological limitations or operational challenges, many financial institutions have been reluctant to push account aggregation. This is a flawed approach, one that neo banks could leverage in their favor. If you are not getting your customers to aggregate data through your financial institution, you are not providing a holistic approach to financial services.

PFM is becoming a platform for engagement. It incorporates a bi-directional approach to banking, whereby the consumer and the bank customer facing teams are on the same page, accessing the same data and information in real-time, without having to migrate through and between multiple banking systems. Alternative delivery has become “my-delivery”, selected on demand by the consumer when and how they chose. Data must be shared, experiences must be seamless and content or solutions made highly relevant. PFM must become a platform, so that financial institutions can be in sync with consumer needs and provide higher degrees of relevance. That's why Geezeo is such a proponent of engagement banking – a bi-directional service platform that leverages technology to achieve customer intimacy at scale, on demand and consistent with the needs of the retail banking customer.

To differentiate, financial institutions must empower consumers while helping them reduce friction in daily banking chores. This can be done while leveraging data to provide high relevancy and assuring customers are getting the help they need, to reach their goals. Indeed, PFM is moving way beyond a budgeting tool.

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