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Why Digital Money Management is Set to Emerge in Asia

The other day, a reputable digital banker asked me, “How many lives does PFM have?”  I smiled.

Whereas Digital Money Management (also known as PFM, Personal Financial Management) in Europe is arguably on its second (or third) life, Asian banks have the opportunity to adopt next-generation PFM for the very first time, while simultaneously avoiding the errors of European banks.

Today's market is hot for PFM, simply because FIs are realizing the necessity of having a well-designed Digital Money Manager at the core of the digital banking experience. As a matter of fact, shouldn’t every bank's DNA be to help customers manage their day-to-day finances better by providing relevant information, help and advice at the right time?


PFM tools have been around since the early days of online banking. In most cases, however, they fell short of bankers’ expectations resulting in lower customer uptake of money manager services.

Why this relative failure? Beyond individual bank cases, one main reason stands out: a major flaw in the design of the tool.  Rather than designing based on actual customer behaviour, the first generation of online money management tools was built on the assumption that most customers would be interested in budgeting and controlling their spending, exactly like that small minority of users already proactively managing their finances with spreadsheets and similar offline tools.

Wrong. In fact, experience showed that the average retail banking customer was definitely not willing to spend so much time and effort tracking and planning their finances.

One would be remiss to think that low user uptake automatically means that customers don't want or need the service. The new Digital Money Manager needs to be user-centered, designed to deliver customer value as an integrated component of the digital banking experience, leveraging three major levers:

  1. Ensuring basic transactional data is cleansed, categorized, and easy to consume
  2. Using technology, particularly machine learning, to detect spending patterns, anticipate and intelligently notify the customer to take action
  3. Designing a stunning UI on all devices, from the first touchpoint

With these 3 principles in mind, banks can leverage the full value of PFM.


The pressure has never been higher for banks to defend their competitive position and share of wallet against aggressive digital banks and emerging FinTech players. It is imperative to provide value whenever and wherever the customer interacts with the bank, and it is no longer enough to simply enable customers to check their account balance, make a bank transfer via mobile or pay a bill online.

Digital Money Management offers an extended and holistic range of capabilities that put basic functionalities into context and perspective, thereby elevating the digital banking experience to the next level. 

PFM tools are increasingly required to enrich the digital experience, improving digital adoption and customer engagement. In the days of customers having an app to monitor almost every aspect of their lives, they are most likely expecting their bank to enable them to manage their finances more easily, too.


The context in Asian banking is not different: Asian banks, regardless of their size or market characteristics, are also being called to stay relevant in their customers’ (financial) lives. Depending on their competitive position, customer strategy and digital readiness, banks can customize their PFM solution to reap a different mix of benefits that corresponds to their needs:

  • Digital Leaders are in the best position to leverage their wealth of transactional data to generate additional revenue - i.e. main benefit = Data Monetization
  • Digital Performers are better at focusing on engaging with customers to further enrich the digital banking experience - i.e. main benefit = Customer Engagement
  • Emerging Digital players will be able to promote new services like Digital Money Management to help their customers adopt online and mobile banking platforms, thereby progressively moving them from cash to non-cash balances and digital payment transactions - i.e. main benefit = Digital Adoption

It is important for each Asian bank, considering its market position and customer base, to understand the value of PFM. Learning from their European peers, each bank has the opportunity (and challenge) to integrate Digital Money Management for a fuller customer experience and enhanced value proposition. Given the high penetration of smartphones in the Region, Mobile PFM will play a key role in differentiating each bank's digital experience.




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