ReadyForZero Inc., which allows consumers to analyze their financial data online to help pay down their debts, announced this week that it now offers users the ability to make unlimited online payments based on the provider's recommendations.
ReadyForZero is one of many companies that provide personal financial management tools to help consumers get a grip on their finances by letting them collect spending data from multiple accounts. Many of these providers do not allow payments, largely out of security concerns.
"It's great to have balance and deposit history and notifications but it would be even better if you could translate it into action," says ReadyForZero co-founder Rod Ebrahimi. "Now when we detect deposits we immediately give you an option to pay one of your high-interest debts. We're trying to change people's behaviors without forcing them to do anything beyond what they're already doing."
Intuit's Mint.com, a popular PFM site, highlights on its security page that "you can't move funds between – or out of – any account using Mint." The service provides bill-payment reminders, but requires users to separately log in to their bank accounts to pay those bills.
PageOnce Inc., another PFM provider, added a bill-pay function a year ago. Both PageOnce and ReadyForZero charge a fee for payments. PageOnce charges 30 cents per bill, whereas ReadyForZero charges a monthly $4.99 fee for access to ReadyForZero Plus, which turns on the payments function.
ReadyForZero began in 2011 as a site that enables consumers to see their asset, liability and credit bureau data, and makes specific recommendations, through mobile and web notifications, based on a user's transaction, payment, deposit and other financial behaviors.
ReadyForZero also makes money by partnering with debt consolidators as well as white-labeling its service for financial institutions.
The latter is what Patricia Hewitt of Mercator Advisory Group expects to see more of.
"When I think debt management I think debt services," she says. "Financial institutions are going to be increasingly interested in providing services to their accountholders."
Debt management is an appealing add-on for financial institutions because "traditional revenue streams have changed," Hewitt says.
As other examples of debt management service companies, Hewitt cites Simple Tuition Inc.'s SmarterBank, with its cashback rewards funneled to student loan payments, as well as savings-related goal features from Bancorp Bank's Simple card and RBS Citizen Financial Group Inc.'s GoalTrack Savings.