In the age of social media, individuals often have many feeds that they track throughout the day, including those from LinkedIn, Twitter, Facebook, Instagram, Snapchat, and more. In the near future, individuals may be paying attention to a new sort of feed: the financial feed.
A survey conducted by Cornerstone advisors found that almost 75 percent of millennials consider their financial lives to be somewhat or very complex, which makes sense. Several different qualitative and quantitative things happen that can impact overall financial health and keeping track of all these things can prove very difficult.
The Excitement around Financial Feeds
Unfortunately, there is not yet a way to get personalized financial information through a feed. While apps can connect readers to financial topics, this strategy often produces results that are too generic to be truly helpful. Likewise, account aggregation makes it easier than ever before to see overall finance situations in one place, but the view is static and without any kind of guidance or insight.
The financial feed promises a different view of personal finances. Rather than being a simple snapshot of current account or a log of purchases, the financial feed provides personalized information from fintech, financial institutions, and other financial providers so that the data is applicable and actionable. People will be able to turn to their financial feeds for a wide variety of information, from news that is directly related to their financial situations to personalized account alerts, including current balances.
Some other expected features include monthly bill reviews that help highlight anomalies; spending pattern analyses that can help point to shifts and deviations; and insights on how shifts in the market will impact personal investment portfolios. Individuals may also expect notifications about services with better rates or lower fees than they currently have, as well as the possibility of direct advice about what to do with specific accounts.
Doubts about the Viability of a Financial Feed
Some people have expressed anxiety about the degree of access that financial institutions, other professionals, or even friends may have if financial feeds become a reality. Users will have control over the account data provided to others as well as the specific information available outside of account data.
Of course, some individuals may want other people to have read access, such as advisors, significant others, and even parents. That way, when something gets flagged, they can seek feedback or advice from someone they trust.
Some experts wonder if financial feeds will actually take hold among consumers. After all, account aggregation services and digital personal financial management tools have had slow adoption rates even though they have been around for many years. The real benefit of a financial feed is that it takes advantages of behaviors people have already established.
Most people already have a flow of checking the feeds on their various social media accounts. Often, that means checking regularly throughout the day. Adding another feed is not too different from the current flow and will likely fit nicely into someone’s established schedule and routine.
Furthermore, a financial feed could provide much more value than other feeds, since it includes time-sensitive information as well as advice about how to address pressing problems. Most current digital finance solutions focus on budgeting and tracking, not on dealing with complex or immediate issues, so a feed could provide significant benefits.
The Path Forward for Establishing a Financial Feed
Of course, the next question is this: who will provide this financial feed? If the idea is easy to execute, then why do we not already have one? The main barrier to implementing this technology is bringing the variety of accounts we have together into a single feed. No effective mechanism yet exists to accomplish this. An effective financial feed needs to have access to the full range of accounts someone has.
Beyond this significant hurdle, the ability to track and analyze relevant information needs to be developed, as does a platform for integrating action items into the consumer feed. These two needs mean that no single financial institution or fintech firm is in a position to provide the feed. The path forward with the financial feed may be collaboration, although some companies are trying to get such a product launched, such as MX.
Finding banks willing to partner in a financial feed venture may prove difficult. On the one hand, a feed is a great way to drive engagement with customers. Most customers are interested in saving or making money, but social media posts by banks are often impersonal and unhelpful. Financial feeds would make it possible to offer personalized suggestions and recommendations, which would drive engagement and loyalty.
On the other hand, banks will compete with other financial institutions in financial feeds, so they may hesitate to get involved. At the same time, it is entirely possible that financial feeds become the battlefield between banks in the near future once they realize the level of engagement possible.