Slow and Steady Wins the PFM Race

Click your stopwatches, because the end of the fast-mover phase of online personal financial management is officially over.

Now come the slow, second-wave adopters — and they spell trouble for any venture still playing the standalone PFM game.

Specially, three established financial services companies — Visa, Wells Fargo, and American Express — have launched their own PFMs over the last several weeks. I have little doubt that more PFMs will come.

The first online PFM of note, Wesabe, launched in 2005; opened its site in 2007. From there, it was a slow and steady watch-and-learn for Old School FS. Now, the mega financial services companies are doing their own PFMs, and that will obliterate any uniqueness enjoyed by the current iterations of standalone PFMs. In fact, it is only a matter of time before rank-and-file community banks will need to include PFM functionality in their online banking.

This has been a slow process since the first off-the-shelf, white-label PFM platform for banks launched in 2008. But like that famous tortoise, the banks have come around. 

The three companies to start PFMs most recently enjoyed more than 22 million unique visitors per month on the websites. gets less than 1.4 million uniques.

I’ve said repeatedly that standalone ventures will have a herculean challenge competing with the kind of traffic numbers of the top banks. And still, the big financial services companies are introducing strong feature sets as part of their PFMs. For example, Visa allows for an integrated SMS payments monitoring feature within banks’ existing online services, such as PNC’s Virtual Wallet. American Express offers the full compliment of tagging to allow consumers to better segment and understand their finances. Wells’s PFM has the colorful look of a Mint.


All this took about two years. Banks historically are brilliant imitators, and online PFM has been mimicked, too. If this is any indication, we should see mobile banking apps from Old School FS worth using in, say, 2013. Let the long wait begin.

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    1. frankrauscher says:

      In 1985 the ABA asked 5 other bankers and me to evaluate a PFM tool designed by a Nobel Prize winning economist. It was self-service “come as you are with only the basic info in your head” and it would provide a solid financial plan for about the bottom 60% of the population. It took about 20 minutes for the customer in private to input the info into a computer in response to simple questions asked by a wise looking face on a monitor and the customer could walk out with a printed basic actionable  financial plan for about $40 at that time (maybe $80 in today’s dollars)..The vendor wanted to franchise it to a small number of banks as part of a consolidator program which was updated by the customers existing financial institutions. Unfortunately, the web as we now know it was only beginning to develop at academic institutions and the consolidator aspect was not operationally within the future thought of us dummies in the room. Now the world is ready for something like that but it requires TRUST. So who do you TRUST?

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