Bank of America's decision to launch an online aggregation service is a direct response to customer demands to simplify their financial lives.
The new service, powered by Yodlee, aggregates a customer's accounts and investments into a single view on a secure BofA portal.
"We know our customers' financial lives are incredibly complicated today, and we also realize that customers will have existing accounts elsewhere," said Erik L. Fine, senior vice president, Internet strategy and development, at $625 billion Bank of America.
"We are making all of that information available online," he added. "We are giving them the ability to view their full financial picture in one place to make their lives more efficient."
Bank of America's interest in Yodlee lies beyond its role as a service provider. The Charlotte, N.C.-based institution is also the lead investor in Yodlee's fourth round of funding.
"Our interest is two-fold. The first is from a commercial perspective. They are a definitive leader in aggregation services," Fine explained. "Second, we believe they have a strong model, and that makes the company a good investment."
Bank of America reported 3.7 million online subscribers and more than 15 million visitors in May. Meanwhile, Celent Communications predicts that up to 19 million Americans will use aggregation services by 2003.
"Our customers are demanding this," Fine said.
Bank of America is using Yodlee's technology to gather customer financial data and display a customer's full personal financial view on a dedicated, firewalled portal. By using the automated system, customers do not have to manually input their financial data, eliminating the chance for errors.
After a period of testing this fall, the service will be offered to all online customers. Customers can register for the service after linking to a dedicated icon on the bank's Web site (www.bankofamerica.com) and inputting their existing Bank of America identification, password and e-mail address.
With access to the customer's information, the Yodlee technology automatically populates the Web page with Bank of America accounts and investments including checking and savings accounts, credit cards and loans.
Customers then populate the site with account information from other institutions. By inputting their user names and passwords, customers electronically give permission for the Yodlee solution to privately and securely gather data from other banks. Through Open Financial Exchange (OFX), a standard for the transfer of financial data between an aggregator and an institution or customer, Yodlee logs on to these sites on the customer's behalf, retrieves the data, formats it and presents it on the same screen. While Yodlee hosts the aggregation service, all user names, passwords and e-mail addresses are stored at Bank of America.
Customers can perform transactions on all Bank of America accounts directly through the portal; accounts originating at other institutions are read-only. Bank of America is adding links that allow customers to connect to another institution's site without having to log on.