Banks' fickle relationship with account aggregation is morphing into outright division.
Some have dropped the service because it appeals to few customers. Others remain devotees because of its growth potential and the fact that its users are among their best customers.
Wells Fargo & Co. was one of the most recent to eliminate aggregation. It said in November that it was dropping its OneLook service.
Aggregation sites enable people to use their bank's Web site to view data from accounts at other financial companies. Advocates say the service encourages customers to use the bank as their primary financial hub, but aggregation is complex to manage and can be hard to market.
Bankers have run hot and cold on aggregation in the past several years. Though many find the idea appealing, others have found it threatening, because it enables people to view account information from and on other banks' sites. The current debate over whether banks should maintain aggregation services at all shows that these concerns have receded as the benefits of aggregation have failed to capture the attention of mainstream customers.
"The OneLook service was never widely used," wrote Andrea Mahoney, a Wells spokeswoman, in an e-mail. The banking company operated OneLook in-house using TekPortal software from Teknowledge Corp. of Palo Alto, Calif.
"We have run both third-party and in-house solutions for aggregation, and we were among the first to integrate it via single sign-on into the rest of our offering," she wrote. "While we have seen interest in the service in both models, only a very small percentage of customers regularly used it." She would not say how many.
Before bringing the service in-house Wells outsourced it to Yodlee Inc. of Redwood City, Calif. Bank of America Corp. and Wachovia Corp., both of Charlotte, currently offer aggregation services through Yodlee.
Teknowledge no longer owns TekPortal; it sold the technology and transferred the development team to Intuit Inc. in August.
Citigroup Inc. of New York also dropped aggregation when its contract with Yodlee expired this fall. In July, when it announced that it would eliminate its aggregation site, Citi spokesman Mark Rodgers said that the decision was prompted by low usage from customers; last week he said the company has no plans to revive aggregation, with Yodlee or any other vendor.
Lawrence Baxter, Wachovia's chief e-commerce officer, said that current users of aggregation say they like it - but that the volume is so low that banks lack enough data even to decide whether to drop it.
Wachovia said it had 3.2 million active online banking customers in October but only about 48,000 actively using aggregation this week.
If other banks are dropping aggregation or unwilling to share their data on use, Wachovia must keep its service running to get the data necessary for an informed decision, Mr. Baxter said. "It's just going to take time," he said.
He compared aggregation today to online bill payment when it was relatively new. Banks' acceptance of aggregation is "still two or three years" behind their acceptance of bill payment, he said.
Betty Riess, a spokeswoman for Bank of America, said use of aggregation is growing among its most valuable customers, who give it high marks. "It is of value to a certain segment of the market, particularly what we call our premier customers."
John Beale is the chief information officer at City National Corp. of Beverly Hills, Calif., which serves private banking and business customers - and which abandoned aggregation last year, after a six-month pilot test of Yodlee's software.
He said his customers were reluctant to enroll in the service because they had to submit information they had repeatedly been told never to share - their passwords to other accounts at other financial companies.
"There is this issue of having to release information to the aggregator," Mr. Beale said. "I think our clients like to control their information."
Furthermore, he said, submitting data on multiple accounts may have been inconvenient.
Aggregation has "got to be really driven by client acceptance and need," Mr. Beale said. "It's a great technology - I think it has a number of possibilities - but it didn't have strong acceptance."
Mr. Baxter said that enrolling in aggregation is a chore, but that signing up for online bill payment can be equally tedious. "You've got to get the customer through a lot of pain to prove the convenience," but many customers have demonstrated that they are willing, he said.
Dan Schatt, a senior analyst for the Boston market research firm Celent Communications LLC, said aggregation "has always had a tough time," particularly in proving its return on investment.
Mr. Schatt also compared aggregation to online bill payment and said they offer many of the same benefits for banks. People who use aggregation are likely to interact more with their bank, he said, and they are using the Internet, which costs banks less than branch visits or answering phone calls.
"These are all the characteristics that you see with users of online bill pay," he said.
