PERSONAL FINANCIAL MANAGEMENT - Strands Finance · OK-to-Spend Analyze Income & Spending Community...

PERSONAL FINANCIAL MANAGEMENT

Product Presentation

PFM

© Strands Inc. 2016

AGENDA1

VALUE PROPOSITION

2 FUNCTIONALITY

3 BUSINESS CASE

4 CASE STUDIES

1 VALUE PROPOSITION

Customers have embraced digital

touchpoints to manage their finances

1. PFM: VALUE PROPOSITION

ADD VALUE Customers need help managing their finances as much as ever

PFM offers people the financial education, budgeting tips, financial guidance, and advice that they want, on any digital device

With rising costs and static incomes,

customers need financial help &

advice

New regulations create a greater need for low-

cost & easy ways to understand financial

situations

FINANCIAL ADVICE NEEDS TO BE DIGITIZED BECAUSE:

EMPOWERPFM is an intuitive and cost-effective way to:

‣ Analyze overall financial situation

‣ Receive relevant advice based on

individual needs and behaviors

‣ Easily act according to the

suggested next best action


COACHTowards better financial health by answering:

‣ What do I have?

‣ How am I doing?

‣ What should I do?

‣ Do it!


DIGITAL MONEY MANAGEMENT SCOPE

SITUATION (What do I have?)

Financial goals

Planning and budgeting tools

Account aggregation

Transaction categorization

ANALYSIS (How am I doing?)

Financial summary

Cash-flow forecast

Spending Analysis

Peer Comparison

ADVICE (What should I do?)

Personalized fin. recommendations

Specific product recommendations

Alerts and notifications

Spending-linked offers

EXECUTION (Do it!)

Portfolio rebalancing

Product purchase (or exchange)

Account sweeping

Automated offer redemption

Source: Forrester Research


CONTEXT: RELEVANT & PERSONALIZED ADVICE

1. REAL-TIME DATA 2. DATA VISUALIZATION3. PREDICTIVE ANALYTICS

4. MACHINE LEARNING

5. GAME MECHANICS 6. BEHAVIORAL SCIENCE7. SPENDING-RELATED OFFERS

8. APIS


1. Protection

2. Personal Financial Mgmt (PFM)

3. Mobile payments

4. Personalized digital experience

5. loT based auto ins pricing

6. Personalized offers

7. Bartering service

8. Alternative currency

9. Mobile cash flow manager

10. P2P Lending

11. Robo-advice

12. Alternative credit scoring

0 % 20 % 40 % 60 % 80 %

30 %

31 %

34 %

39 %

40 %

41 %

44 %

46 %

47 %

51 %

61 %

78 %

Protection andPFM scorehighest across allgeographies andall demographics

A smaller share ofconsumers see valuein robo-advice oralternative lending

Top innovation priorities for banks based on perceived value from customers over next 5 years (% selecting top 2 box out of 5 for value)

Source: CGI 2016 Consumer Banking Survey

WHAT CUSTOMERS VALUE MOST1. PFM: VALUE PROPOSITION

2 PFM FUNCTIONALITY

2. PFM FUNCTIONALITY

KEY FEATURES

• Set PFM parameters that meet your business requirements

• Determine all the default parameters beyond language, currency and localization settings

• Create a unique UX and differentiate in your market

CUSTOMIZABLE

• Assemble your own PFM by selecting the widgets you need

• Enable your customers to create personalized PFM dashboards with mini-widgets

• Showcase PFM teasers ensuring higher customer engagement

MODULAR

• Empower your customers to control their finances from any device

• Choose between a native, hybrid or web responsive solution

• Seamlessly integrate within your online banking platform

MULTI-DEVICE

2. PFM FUNCTIONALITY

FUNCTIONALITY OVERVIEW

Plan

Budgeting

Saving Goals Net-Worth

OK-to-Spend

Analyze

Income & Spending

Community

Cash Flow

Account Aggregation

Track

Smart Notifications

Transactions Financial Calendar

What-if?

Create your personalized overview

Mini-Widgets are the bite-sized version of Main Widgets.

They enable users to easily create a personalized 360° “bird’s eye view” over their personal finances.

Dashboard

Dashboard

Bank A

Dashboard

Bank A

Check how much can you really spend

Dashboard

Bank A

Record your cash transactions easily and use it as a payment trigger

Dashboard

Bank A

Aggregate all your bank accounts into a single place

Bring transparency & clarity to your financial data This widget is the foundation of PFM: all historical transactions are automatically categorized and then organized into interactive visualizations.

Tracking income and expenses is more fun when using a variety of data infographics such as planet, donut, bubble chart, or treemap.

The view can be customized by period, account and category level.

Income & Spending Analysis

ANALYSIS

ANALYSIS

Income & Spending

Understand how you spend your money and discover monthly trends

A unified timeline gives customers a contextual view of their financial life rather than just showing historical transactions. Serve relevant and purposeful new product suggestions based on events or transactions.Label simplification transforms complex transaction descriptions into a meaningful information.

Timeline

ANALYSIS

Benchmark your expenses with others

Users can anonymously compare their financial behavior with peers. They can determine their peer group by setting demographic attributes such as age, gender, city, etc.

The comparison results are graphically displayed for each spending category and can be viewed for any timeframe.

Peer Comparison

ANALYSIS

ANALYSIS

Peer Comparison

Benchmark expenses against your bank community

Manage and personalize your transactions

Users can view, filter, rename, split and add tags to their transactions.

The widget also enables users to manually add cash transactions.

Users can also create their own categories and rules to further personalize and fine-tune the categorization of their transactions.

Transaction Details

ANALYSIS

ANALYSIS

Transaction Details

Review & forecast incoming & outgoing cashflow Provides a visual analysis of cash flow over time by tracking historic, actual and forecasted inflows & outflows. An account selector gives users a range of analysis options.

To help with planning ahead, this widget also provides forward-looking insights based on forecasted spending patterns.

Cash Flow Analysis

ANALYSIS

ANALYSIS

Cash Flow Analysis

Track your performance month after month

Keep your expenses under control

Users can create monthly budgets for all their spending categories and sub-categories.

All budgets are tracked, updated automatically and visually illustrated in a bar chart.

Budget setting is facilitated by automatic budget amount suggestion based on past spending patterns and community expenses.

Budgeting

PLANNING

BudgettingPLANNING

Gain control over your expenses

Achieve your financial goals The widget enables users to create, manage and achieve personal saving goals.

Both short & long term goals can be set such as planning a summer vacation or buying a new bicycle.

The widget optimizes saving plans by dividing monthly savings into smaller daily or weekly portions.

Users can also share their goals on social media and request contributions from friends & family.

Saving Goals

PLANNING

Saving GoalsPLANNING

Achieve your life goals

Identify your spending patterns An alternative visualization of past and upcoming income & expenses in a calendar layout. Clicking on a day shows a clear breakdown of all its transactions & events.

The status of daily cash flows are shown via smart heat map. A built-in pattern recognizer enables forecasting of upcoming expenses & account balances, so users can stay on top of their monthly payments.

The widget is designed to work with electronic billing, direct debit orders & payment systems.

Financial Calendar

PLANNING

Financial CalendarPLANNING

See all your financial events at a glance

Find out what you own & owe

This widget allows users to quickly and easily aggregate their assets & liabilities into a comprehensive net worth infographic.

The historical net worth performance can be monitored as well.

Also includes a simulator view to forecast future net worth position based on different scenarios.

Net Worth

PLANNING

Make wiser purchase decisions

Bringing real time PFM insights to help users make more informed purchase decisions.

Calculates the impact of a potential purchase based on 4 types of effects: balance, cash flow, saving goals & budgets.

Users can simulate various “What If?” scenarios to discover the financial implications of any potential purchasing decision.

What If?

DECISIONS

Always stay informed

Users can set personalized alerts to stay up to date with their personal finances.

Alerts can be set for events or widget activity including cash flow, balance, budgets, transactions, Safe-to-Spend, or Financial Calendar.

Various delivery channels can be used such as email, online and mobile (via SMS or push notifications).

Notifications

DECISIONS

NotificationsDECISIONS

3 PFM BUSINESS CASE

3. PFM BUSINESS CASE

NEW LANDSCAPE => NEW MARKET DEMANDS

BEHAVIOR CHANGE: SHIFT TO DIGITAL

Mobile mind shift. Customers expect

convenient, real-time, frictionless experience.

MORE COMPETITORS - INDUSTRY DISRUPTORSNew digital banks and B2C

FinTech providers are attracting your clients with

more lucrative offers

NEW AVAILABLE TECHNOLOGY

More advanced application of artificial intelligence e.g. Machine Learning. Better integration capabilities of

software

Efficiency Agility Personalization

Trends that will have the biggest impact on retail banks by 2020

THE JOURNEY TO NEW CLIENT RELATIONSHIP MODEL

INCREASE REVENUE FROM DIGITAL

CHANNELSChange of the

servicing business model

OPTIMIZE CUSTOMER ENGAGEMENT

Increase frequency and quality of

interactions with clients

1. SHIFT TO DIGITAL2. COMPETITION3. TECHNOLOGY

KNOW YOUR CUSTOMER (KYC)Interact in meaningful

conversations with smart use of data.

?!

BUILD RELATIONSHIP BANKING

More frequent and meaningful interactions across all touchpoints.

More trust!


KYC: MEANINGFUL INTERACTIONS

Wisdom

Knowledge

Information

Data

Applied

Context

Meaning

Raw

I can be better off buying a flat ona mortage!

I spend 40% of my monthly incomeon housing

This month I spent 1,000 Euroson rent

02-06-15 Ms. Smith -1000,00 EUR202131537032KDC-174201310100

Moving from something that happens on a weekly basis to several interactions a day

?!


OPTIMIZE CUSTOMER ENGAGEMENT

Source: Unicredit study

3 levers of value transformation:

1. Restructure Session Time

2. Increase Frequency of Interaction

3. Gain Quality of Interaction

An average online banking session last approximately 600 seconds:


BUILD RELATIONSHIP BANKINGLeverage customer data to provide useful insights and personalized recommendations for the next best action

Your account XX24 has been having at surplus of >€300 at the end of every month. You can earn some extra money by applying to one of our deposits.

Open a deposit Not interested

You don’t have enough money to pay for your gas bill. Would you like to use our emergency payment service?

Tell me more No thanks

We have noticed that your are transferring €200 every month to the account 1234-4567-11-1234567890. Maybe you want to set up a recurring transfer.

Yes No

Hi, your Restaurants budget is about to run out. Check out this restaurant in your neighborhood, offering 20% discount.

Show me Other suggestions?


INCREASE REVENUE FROM DIGITAL CHANNELS

Wealth Management Managing Net Worth

Personal/Business Financial Management Financial Planning

Credit Cards, Loans, Transaction Management

Electronic Bill Payment and Presentment, P2P and Bank Transfers

Direct Deposit Remote Deposit Capture

Balance Inquiries Account Alerts

CUSTOMER VALUE

PERFORMANCE

MOVEMENT

SECURITY


Benefits for the bank:

Improved quantity, quality and duration of interactions

The domino effect of PFM: more touchpoints > higher engagement > increased loyalty and retention > more revenue generated through web and mobile channels

Increase in customer long-term value

Seamless integration with any online and core banking system

PFM IS THE HEART OFDIGITAL BANKING It’s no longer a nice-to-have


PFM IS CRUCIAL FOR LONG-TERM SUCCESS

DEMONSTRATE CUSTOMER ADVOCACY

If customers feel a bank acts in their best interest, they will borrow, invest and buy more

DIFFERENTIATE FROM COMPETITORS

DMM will become your differentiator that competitors

cannot quickly replicate

ATTRACT YOUNGER CUSTOMERS

They’re comfortable with digital touchpoints. Building a relationship will pay off later.

*Source: Forrester Research


ITS A TREND: CHALLENGER BANKS WW ARE USING PFM TO ENGAGE AND WIN CUSTOMERS

Challenger banks such as Simple, Mondo, Hello bank, Number 26, Knab have put PFM at the heart of their propositions.

To keep costs down, these disruptors rely heavily on software to deliver guidance, help, and advice and to open accounts and execute transactions.


BENEFITS BY BUSINESS AREA PFM generates value across the bank

PFM

• Attract new customers• Sell more to existing customers:‣ Identify sell opportunities‣ Make personalized offers‣ Increase cross/up-sell

SALES

• Differentiate against the competitors• Position yourself as the primary bank • Lead the FinTech race• Create image of innovative bank• Get more recognition and awards

MARKETING

• Increase user adoption of online & mobile banking

• Attract and engage more in digital channels

• Increase the number of touch-points

CHANNELS

• Create superior customer experience:‣ Higher satisfaction‣ Improved loyalty and retention‣ Recommendations

• Generate deeper customer insights• Offer personalized solutions

CUSTOMER SERVICE


BENEFITS BY BUSINESS AREA Research-based proof points

CUSTOMER SERVICE MARKETING

Higher satisfaction: Higher cross/up-sell: Higher adoption rate: More recognition:

80% of users are “pleased” or “highly pleased” with PFM

4 times more financial products are opened compared to no PFM users

PFM users log in to online banking more than twice as often as non-users

For 3 years in a row, BMO was recognized by Celent with a Model Bank Award for excellence in digital banking (see next slides for more information)66% improve their financial

situationReauthorized payments are >15 times vs. no PFM users

Spend twice as much time in the online banking environment once logged in

88% say they will use PFM regularly in the future

Increase total number of accounts by 19.4% after one year

Easier and more efficient online experience

Deutsche Bank after launching PFM in December 2014, received a got a lot of recognition from analysts and press. Thanks to positive customer feedback and high adoption rate of FinanzPlaner, this PFM implementation has not only been the fastest (5 months) but also the most successful in Europe

9 out of 10 say they would recommend PFM to others

Revenue grows 5.5 times faster than customers without PFM

Digital channel become the primary touchpoint with the bank

Higher retention rate:Annual retention rates are 99% among PFM users

63% say PFM will strongly increase their loyalty

By offering an integrated view of all bank accounts and credit cards, the FI positions itself more as the primary bank for its customers

25% say they are less likely to switch to another bank

50% less in accounts closed after the introduction of PFM

Sources: Strands PFM customers and Industry Research (Forrester, Celent, Aite group and Intuit)

SALES CHANNELS


PFM DELIVERS VALUE:

Detailed information about finances

Understanding of financial situation

Intuitive tools to budget and save

Relevant financial advice

Personalized products and services

Increased use of digital banking

Additional marketing opportunities

More relevant cross-selling offers

Deeper customer insights

Controlled spending & increased savings

Stronger customer advocacy

Higher willingness to pay for a service

Reduces costs in other channels

Improved rate cross-selling

Better product development

Reduced credit risk

Increased customer loyalty

Direct fee income

New customer acquisition

TO YOU & YOUR CUSTOMERS

BANK BENEFITSEFFECTCUSTOMER

BENEFITS

Source: Forrester Research, Inc.

1

2

3

4

5


PROVEN PERFORMANCE RESULTS

Sources: Strands PFM customers and Industry Research (Forrester, Aite group and Intuit)

DMM USERS

Reduce costs in other channels

Improve rate cross-selling

Better product development

Accelerate ROI

Increase customer loyalty

Acquire new customers acquisition

Double time spent on Online Banking

Generate revenue 5.5x faster than customers without DMM

Open 4x more financial products vs. non-DMM users

50% SME willing to pay $10 per month to receive BFM services

99% retention rate (4% higher than non-DMM users)

30% would leave to find a better money management solution

BANK BUSINESS OBJECTIVES


PROVEN SUCCESS Case study: BMO MoneyLogic

Country: Canada

PFM solution name: MoneyLogic

Number of users: 2.5 million

Type of deployment: Standalone

Launch year: 2011

Upgrade: Success of MoneyLogic leads to

an upgrade in 2014 with tablet and smartphone

Recognition: For 3 years in a row, BMO has been recognized by Celent with a Model Bank Award for excellence in digital banking


CLICK HERE TO SEE MORE CASE STUDIES

PERFORMANCE RESULTS

Uptake first year: 25% of BMO online banking users registered to PFM

Over 50% created a budget (engaged customers)

Understanding Financial Situation:

PFM users set up >15x more scheduled payments vs. non-PFMImproved Cross Selling:

MoneyLogic users on average opened 4 times as many BMO products vs. non-PFM

Revenue from the average MoneyLogic user grew 5.5 times faster than typical retails customers

Reduced Customer Attrition:

Attrition rate amongst PFM users is 4% lower vs. non-PFM

Source: Forrester Research - the Total Economic Impact (TEI) of the Strands PFM Solution



Source: Forrester Research - the Total Economic Impact (TEI) of the Strands PFM Solution

Fast Time-to-Market: Strands accelerated innovation with a “on-time, on-budget” PFM project

Brand positioning: investment in PFM enhanced BMO’s reputation in the market

User Experience: web and tablet user interface and functionality impresses customers = higher retention, new clients

Business Intelligence: active use of MoneyLogic provides valuable, actionable transaction and behavioural data

OVERALL IMPACT SAVINGS & ROI OVER 4 YEARS

Savings from higher customer retention $10,202,000

Profit associated with retained customers $2,900,000

Savings from faster time-to-market $3,712,000

Total Benefit $16,828,000

ROI of the project 22 %

Payback Period 24 months



4 CASE STUDIES

4. CASE STUDIES

DEUTSCHE BANK

Country: Germany

PFM solution name: FinanzPlaner

Number of users: 4 million

Deployment: Web, Tablet, Mobile, Apple Watch

Launch year: 2014

4. CASE STUDIES

BARCLAYS

Country: UK

PFM solution name: Finance Manager


Deployment: Web, fully integrated

Launch year: 2012, upgraded in 2016

4. CASE STUDIES

BANK OF MONTREAL

Country: Canada

PFM solution name: MoneyLogic


Type of deployment: Standalone

Launch year: 2011

Upgrade: Success of MoneyLogic leads to

an upgrade in 2014 with tablet and mobile

Recognition: For 3 years in a row, BMO has been recognized by Celent with a Model Bank Award for excellence in digital banking

4. CASE STUDIES

BCV

Country: Switzerland

PFM: integrated with online banking

Number of users: 200,000

Deployment: Web, Tablet, Mobile

Launch year: 2015

4. CASE STUDIES

BCV

4. CASE STUDIES

ISRAEL DISCOUNT BANK

Country: Israel




Launch year: 2016

4. CASE STUDIES

BANK LEUMI - ISRAELCurrently being implemented

4. CASE STUDIES

ALLIED IRISH BANKS

Country: Ireland

PFM solution name: My Money Manager


Deployment: Tablet, mobile

Launch year: 2012

4. CASE STUDIES

POST FINANCE

Country: Switzerland

PFM solution name: E-Cockpit


Deployment: Web & Tablet

Launch year: 2012, upgrade 2016

4. CASE STUDIES

HELLO BANK!

Country: Italy

PFM solution name: Hello! Personal

Number of users: New bank when when live

Deployment: Web, Tablet & Mobile - native

Launch year: 2013

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4. CASE STUDIES

UBI

Country: Italy

PFM solution name: Qui UBI


Deployment: Web, Tablet & Mobile

Launch year: 2016

4. CASE STUDIES

ABU DHABI COMMERCIAL BANK

Country: UAE




Launch year: 2016

4. CASE STUDIES

BAC

Country: Central America

PFM solution name: Mis Finanzas


Deployment: Web, Tablet & Mobile - native

Launch year: 2016

4. CASE STUDIES

BBVA

Country: Spain

PFM solution name: Mi día a día


Deployment: Web

Launch year: 2008, upgraded in 2016

CLIENT REFERENCES

“The FinanzPlaner (powered by Strands) is a strategic investment for us. The huge amount of positive customer feedback proves that it was the right decision”

Michael Koch, Head of Online and Mobile Bankingat Deutsche Bank

“My Money Manager (powered by Strands) provides our customers with deep financial insights, an excellent user experience and an ability to manage their money on the move through our online channels”

John Brennan, Head of Online ChannelDevelopment at AIB

“Strands has been a great partner in this journey. Barclays was able to integrate Strands widget logic and functionalities creating a seamless user experience”

Simon Shorey, Head of Social Media Platformsand Servicing, Digital Banking at Barclays

“We are excited about the positive response from our customers who have been looking for a better way to get a clear picture of where their money is going. MoneyLogic provides them with immediate insights into their spending and savings habits”

Dan Dickinson, Head of Online &Mobile Banking at Bank of Montreal

THANK YOU

LEARN MOREABOUT STRANDS:

WEBfinance.strands.com

BLOGblog.strands.com

TWITTER@StrandsFinance

http://finance.strands.com

http://blog.strands.com

https://twitter.com/StrandsFinance

PERSONAL FINANCIAL MANAGEMENT - Strands Finance · OK-to-Spend Analyze Income & Spending Community...

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Transcript of PERSONAL FINANCIAL MANAGEMENT - Strands Finance · OK-to-Spend Analyze Income & Spending Community...