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Intuit Web Banking Aims to Fulfill PFM's Original Promise

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When Intuit Inc. launched FinanceWorks in 2008 it said the personal financial management system would revolutionize online banking.

The product was a success — one in three Intuit clients offers it — but it had its rough edges.

Like many new features of online banking, FinanceWorks was at first hidden behind a tab. And that meant a problem: Clicking that tab would open the application in a new window, and while the user was focused on that window, the online banking session could time out in the background (a security feature meant for forgetful Web surfers). If users still wanted to set up a bill payment or transfer funds, they'd have to go through the hoops of logging in to online banking all over again.

Intuit fixed that issue last year through tighter integration. Its latest software, announced this week, brings its PFM tools, as well as new features such as merchant-funded rewards, front and center.

"Having your entire financial picture in one place, making all key jobs more discoverable and more intuitive — and ultimately easier to use … will increase the engagement [financial institutions] have with the user," said Albert Ko, senior vice president of consumer solutions for Intuit Financial Services.

Jacob Jegher, a senior analyst at the research firm Celent, said Intuit "is moving in the direction where online banking is headed, which is a 'dashboard'-like experience that goes beyond a static display of information."

Beneficial Mutual Bancorp Inc. of Philadelphia has offered FinanceWorks for more than a year and began testing the new online banking experience a few months ago. About 44,000 of Beneficial's online banking customers use the new interface.

"It is very straightforward and transparent, and the ease of use is the most important," said Denise Kassekert, executive vice president of relationship banking for the $4.7 billion-asset Beneficial.

Kassekert said in addition to a clear, concise view of their financial life with the bank, customers' ability to make bill payments and cash transfers directly from the FinanceWorks home page represented an advance. The original FinanceWorks did not support payments and transfers. Today, customers "have an immediate overview of their relationship with the bank, and they can make a decision if they need to," she said.

Analysts said the changes reflect cross-pollination from Intuit's ownership of Mint.com, a free-to-consumers PFM website Intuit bought in 2009. Mint, which is used by millions, creates a dashboard of consumers' financial lives by aggregating customer accounts, detailing their spending and helping them set financial goals.

"The intent is to make the home page more approachable and more actionable for consumers, and it shows consumers the relationship between one element and another," said Emmett Higdon, a senior analyst at Forrester Research Inc. in Cambridge, Mass.

Higdon said one of the common features of modern website redesigns is a reduction in the number of clicks that consumers must make for common things like bill payments, viewing statements or setting up alerts. Intuit's redesign reflects that, he said.

Higdon said the advantage Intuit has over third-party PFM providers is its support for transactions to be made directly from the home page. "It keeps the customers coming back to your site to manage their finances, as opposed to a third-party site," he said, where consumers must leave if they want to pay bills.

Analysts also said they were intrigued by the rewards piece of the new home page. "By bundling merchant-funded rewards into the online banking offering … there is a huge opportunity for the financial institutions," said Ron Shevlin, a senior analyst at Aite Group LLC in Boston.

Cardlytics Inc., of Atlanta, will power the back-end merchant-funded rewards program for the banks and credit unions. Intuit said it will link consumers' debit card purchases from various merchants with competing deals or money-saving opportunities. Those offers can be redeemed for cash that will be deposited into customers' accounts when customers swipe their cards.

"The targeted piece is a merchant-funded reward, but there is no e-mail or coupon or printout or code," Intuit's Ko said. "All [they] do is click to activate the offer … swipe the card, and the amount is credited back to their account."

Kassekert said Beneficial is using the merchant-rewards piece to encourage its check card users to switch from PIN-based transactions to signature based. Cardlytics can support rewards on all payment types, but Beneficial is using it only for signature transactions, which bring it more transaction revenue. "The revenue stream is important to us," Kassekert said.

Intuit's financial institutions business is the former Digital Insight Corp., which it bought in 2007. The companies had been working on the design of FinanceWorks before the acquisition.

Through its more than 1,500 financial institution clients, Intuit said it has relationships with more than 10 million banking customers. About 3 million use the new home page, which Intuit said it has been testing for about a year.

"The new online banking experience transforms the way consumers interact with banks or credit unions, and it helps financial institutions increase customer engagement," Ko said.

Analysts said the new website would also increase stickiness for the financial institutions using it.

"This type of home page for online services is critical for banks and credit unions to deliver on the promise of becoming the financial hub for their customers," Cathy Graeber, founder of the consulting firm Swimming Upstream, said in an e-mail.

In a case study of a top-tier credit union from April 2010, Swimming Upstream, in Carmel, Calif., found that users of FinanceWorks logged in to the website of the financial institution twice as often as those who did not. The study also found that users of FinanceWorks had a 98% retention rate compared with an average retention rate of 79% for all of the credit union's customers. Graeber said banks and credit unions that use a home page like Intuit's with "highly integrated tasks … for online services will have a real differentiation compared to what most others are offering."

Still, the new design leaves some room for improvement: Consumers also want to be able to customize the look of their home page and decide which tools are put within easiest reach, experts say.

Customization "changes online banking considerably, when it becomes something the user can design whichever way they want," said Nicole Sturgill, a research director at TowerGroup in Needham, Mass.

Ko said Intuit is considering adding customization, but he said it was something that financial institutions requested Intuit examine in a measured fashion. "With further customization, I think the jury is still out," Ko said.

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