Banks explore aggregation opportunities

TORONTO — Aggregation is aggravating to American financial institutions, says an industry analyst, but a Canadian bank executive thinks online customers here will find it soothing.

Aggregation is the ability to bring together information from competing financial services and institutions such as banks, credit card companies and brokerages to one Web site.

It ought to be appealing to people with multiple accounts, but Ron Shevlin, research director for online financial services at Forrester Research, told an e-business conference for Royal Bank employees this week that only wealthy Americans are interested in the idea.

“Nobody wants aggregation,” Shevlin declared, let alone understands it.

But Tom Wolf, the Royal Bank’s senior vice-president for e-business and host of the symposium, said an ongoing pilot project shows the opposite.

“We’ve had more positive feedback on aggregation than he’s alluded to,” Wolf said in an interview.

By the end of the year the Royal Bank will probably offer an aggregation service, he said.

Third-party aggregators include companies such as CashEdge Inc. of Milpitas, Calif. and Yodlee Inc. of Redwood City, Calif. They work by getting permission to use the multiple passwords a customer has with many companies, from banks to loyalty points providers.

Some aggregators make customers go to their sites to see combined accounts, which Wolf said makes customers uncomfortable. Other aggregators collect data across the Web and put it behind a bank’s site, letting it offer one-stop service.

Most Canadian banks are now working on aggregation projects, Wolf said. He predicts they will likely to standardize on CashEdge, whose technology lets the banks keep Web customers on their sites.

As a result, basic aggregation won’t be a service differentiator in Canada, said Wolf. However, if a bank gets permission to see a customer’s entire financial portfolio it could offer added services, such as a tailored financial plan.

It’s the fourth year for the Royal Bank symposium, which ended Tuesday, aimed at getting bank employees to think about future uses of technology and financial services.

The Bank of Montreal held a similar symposium at the beginning of the year.

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Howard Solomon
Howard Solomon
Currently a freelance writer. Former editor of and Computing Canada. An IT journalist since 1997, Howard has written for several of ITWC's sister publications, including Before arriving at ITWC he served as a staff reporter at the Calgary Herald and the Brampton (Ont.) Daily Times.

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