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Personal Finance Management tools have been around us for a long time focusing on transfer information from financial products to management tools that allow the detailed analysis of finances, income and outcome categorizations, setting budgets and follow the finance evolution.

An effective PFM has these main characteristics:

 Transaction Tagging - Automatic categorization of transactions to understand spending breakdown, plus manual reallocation enabled with the ability to manually reallocate categories.
• Budgeting and Alerts - Ability to set a budget based upon categorization, and enable alerts to help customer stick to budget plan.
• Goal Management - Ability to enter financial goals, for example, Save for my child’s education, get a new car and track progress against them.
• Financial Calendar View - Display of regular incoming and outgoing transactions to enable users to forecast spending more accurately.

The rapid growth of smartphones and tables make the customers’ needs change. Today users want to be able to investigate, buy and manage their financial services independently of the interface or real time situation. This is a key factor to PFM´s new tools that should promote functions and complex operations.

In this context, Personal Finance Management Tools (PFM) are evolving into becoming true digital financial advisor, using user data combined with other clients data, training business intelligence tools in the learning of costumers personal financial habits. This factor should proactively help the client take the in-between steps involved in the achievement of short and long term personal financial goals.

The use of social media and advanced consulting services could open new ways to create platforms or social forums to share advice and ideas about how to administer the money better, how to achieve financial goals or show customers how their own spending patterns match with their related groups.

Advanced Characteristics:

  • Social Analytics - Ability for customer to compare their own spending pattern against similar aggregated spending from others.
  • Social Integration/Content – The opportunity to include community content/integrate with major social media forum or include bank generated value added content
  • Product Recommendation - The opportunity to suggest products to customers based upon their needs and track responses.
  • Account Aggregation – The opportunity for the customer to aggregate financial and non-financial accounts held with other providers.
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