Absa's new online banking portal, Absa Online, is not a reaction to personal financial management (PFM) start-up 22seven, but the result of a two-year development process that was recently completed.
This is according to Adrian Vermooten, head of Absa's online and mobile channels, who spoke to ITWeb yesterday about the bank's digital aspirations and the recent controversy surrounding 22seven.
Vermooten says Absa Online, the bank's revamped online presence that includes the beginnings of PFM functionality, is “nothing new”. It is intended to give its 1.25 million online banking customers a means to manage their finances, without having to employ the services of a third-party service to which they would have to divulge their banking credentials, he explains.
Absa Online was launched in beta at midnight on Monday and includes a new interface with graphics that give customers a dashboard view of their financial situation in an assets versus liabilities reflection, which includes investments.
Start-up stir
Created by former 20twenty CEO Christo Davel and launched in beta in January, 22seven caused a stir among SA's big four banks, of which Absa was the most vocal and resistant - even going so far as to block 22seven's financial data aggregator Yodlee.
While Absa, Standard Bank, Nedbank and First National Bank (FNB) initially cried foul at the notion of customers divulging their Internet banking information, including their unique PIN number - required for the use of 22seven's PFM platform - much of the clamour has died down.
At the time of 22seven's launch, Absa issued a statement warning customers it is “absolutely imperative that Absa customers and, in fact, customers of all banks, never divulge their sensitive personal information, such as PIN numbers, passwords and one-time passwords, to any parties”. The bank also hinted at an upcoming launch of its own PFM tools - “set for release later this year”.
FNB became the first bank to officially support 22seven, allowing its customers to make use of the “read only” online banking profile option.
Principle point
Vermooten says that, while Absa is intent on sticking to its original conviction that third parties should never have access to banking credentials, it is “about the principle of the matter” rather than a case of the financial giant “going after” a start-up.
“Absa is consistently saying its customers' security on [the bank's] platforms is paramount and we continue to advocate that they do not share credentials with a third party - ever.”
He says, while he is not sure how many of Absa's clients signed up for 22seven in the first place, he expects they will, for the most part, opt for their own bank's platform - which is set to include further functionality, such as transaction tagging, in the near future.
“The two value propositions (of 22seven and Absa respectively) are fundamentally different. On the one hand, you have a service that costs you R70 a month and requires that you divulge banking credentials, but you may get a richer experience. On the other, you have Absa's core PFM tools that are included in your banking package and you don't have to give your details out to anybody. I understand the one a rational person would choose.”
Holistic view
Despite Absa's position, 22seven says the two parties are in “ongoing discussions” concerning a means by which 22seven can give the bank's users access to its PFM tools, in a manner that Absa is comfortable with.
Davel says Absa's platform is essentially a financial management tool that forms part of its banking offering to its customers and reflects data gathered from Absa products and services.
“22seven is not a budgeting tool; it's a service that fundamentally alters people's relationship with money. The intention is to help people become aware of their financial behaviour so they can make different choices. The first step is seeing all your financial data in one place. 22seven offers an unbiased service for customers of all South African banks as it aggregates data from numerous financial institutions.”
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