One stop shop: Track your money online

Personal finance solutions websites are increasingly becoming popular by helping users cut on their spending and providing high security levels.

Like many people, Anish Joseph, consulting architect at Vigyan Labs, depended on his consultant to keep track of his finances. About a year ago, Joseph stumbled upon Perfios, a personal finance solutions website. “I was finally able to have an intelligent conversation with my consultant. It doesn’t take a lot of time to configure, few hours initially and then maybe 30 minutes every week.” What suits users like him is the fact that the website does not store passwords on its server and the response time for queries is satisfactory.

Having faced a similar situation himself three years ago, V R Govindarajan, co-founder and director of Perfios, realised that users were looking for simpler options to do their personal finances online. With most individuals, having six to eight accounts including a bank account, fixed deposit accounts, couple of mutual funds and insurances, Govindarajan believes personal finance websites are gaining fans since they can help people sort out where their money goes.

Perfios claims that 200,000 users, primarily in the age group of 25-35 years, use its online services.

Several sites combine their members’ banking, credit card and brokerage accounts into one composite picture by accessing the accounts online. To do that, members must share their account information, like user IDs and passwords. In return, they get an itemised view of their money. One of the benefits of the services is their ability to track spending and to help people save to achieve a goal — like buying a house or taking a long vacation.

Users are required to configure at least one PC (preferably personal desktop or laptop) with their net banking account or online brokerage account. “Then, log in to Perfios, which is programmed to pick up your financial data, transaction details, investment accounts and so on,” explains Govindarajan. The other way, which personal finance sites offer, is to update their financial planning account with the annual or quarterly bank account statements or contract notes provided by brokerages to Perfios.

To many people, handing over access to their financial life might sound like a security risk. As a result, most personal finance sites come with the promise of “bank-level security”. The sites go to the bank’s website, pull the information in, but the same is not stored on any server location.

Interestingly, several financial planning and advisory firms (with 30-40 clients) also prefer to use the websites to keep close track of their clients’ finances. Bangalore-based Srikant Bhagavat’s Hexagon Capital Advisors and Lovaii Navlakhi’s International Money Matters use Perfios.

There are about two dozen personal financial management sites, but leading players like Intuit Money Manager and Perfios stand out due to the stringent security offered to users.

Perfios users such as Shantanu Sharma, manager (sales), PricewaterhouseCoopers admits: “The site gives me one-window view of my financial position not only on my personal computer but also on my mobile.”

Financial planners suggest that if you don’t know where your paycheck goes then an online budgeting site can help. The sites will gather transaction data daily from credit cards and online bank accounts and then put expenditures in categories such as groceries and gas. Through pie charts or graphs, the sites show how you spend your rupees month after month.

Additionally, sites such as Intuit help you plan taxes and save accordingly, while users can file income tax returns through Perfios. “Analysing your transactions is important for disciplined money management. So, when our users transact through cash, they send a text to Intuit specifying the amount spent and on what. This, in turn, gets fed in to their Intuit account,” explains Senior Product Manager of Intuit Money Manager Prakash Kumar. Individuals can set goals on discretionary expenses - dining or shopping - and, thereby, keep a tab on their expenses. “If you overshoot your goal, you will be alerted.”

To be able to access financial data analysis services, users are required to pay a fee. Intuit allows new users to try its product free of cost for 30 days. After the initial period, they have to pay Re 1 a day. “Those who do not want the trial product, are given a 10 per cent discount when they sign up.”

Perfios, on the other hand, offers a basic plan free of cost that allows data compilation. The company also offers plans priced at Rs500 and Rs1,500 a year, where users can compile data, file tax returns, store all important documents like salary slips, old tax returns receipt, dividend statements and get investment suggestions. There’s little to wonder when Govindarajan says he has seen bulk of individual users graduate from basic to paid plans, within a year of signing on.

Online financial tools Perfios boasts of having doubled its user base from 1,00,000 in seven months and expects to move to 5,00,000 users in less than 12 months. Kumar shies away from revealing numbers, but specifies that their users are individuals aged between 25 and 45 years. Financial advisory firms too have expressed interests in using the site, he informs.