Personal Finance Management Online in the CIS countries

I would like to talk on the topic of personal finance management on the Internet, are there any prospects for the development of such systems and how are they better / worse than desktop products? If you are interested in this topic, then you probably know that there are a lot of online financial managers on the English-language Internet. But, is it enough to make a Russian-language interface to repeat their success?

We work in the field of financial software for many years, but still do not have an online service for accounting for finances. Of course, we are thinking about developing (and generally expediency) of this kind of product, and here I would like to share with you my thoughts.

Reasons for the emergence of online systems in the US

Desktop products for accounting personal finances appeared in the United States in the late 80s of the last century. Their online counterparts appeared much later, and the reason for this was the following.
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Tell me, what is the main problem of all Russian-speaking financial managers without exception? That's right - cost accounting. Most people can’t imagine how every day you can record all expenses over a long period of time. It takes a lot of time, effort and delivers a lot of inconvenience.

Imagine how great it would be if we could spend money (using plastic cards, using Internet wallets), and then simply open the program and see where and how much money was spent. No need to record anything. The program itself automatically downloads all transactions on cards, Internet wallets and displays all this in the form of beautiful graphs. It remains only to analyze and make a plan for the next month.

Thought so in the US, until they realized all this in the form of real financial products. But, a desktop program that constantly asks on the Internet is not a very convenient solution. If the program needs the Internet all the time, why not put the program itself on this Internet? No matter how many plastic cards you have, all the real and current information is in one place, you just have to look at the reports . This is a key feature of the online system. In order not to manually enter all costs, online systems collect all the information on their own 24 hours a day, 7 days a week.

Yes, you may not always have excellent high-speed access to the network, yes, there may be some risk of an attack on the server, but the idea of ​​full online synchronization with all banks is worth it.

What about the CIS countries?

I have not once communicated with representatives of large banks in Russia and Ukraine on this topic. Here I would like to quote the words of the director of electronic services development at Alfabank: “ The fact is that the bank can give any information to the client’s accounts only to this client, identifying it independently. If the bank provides this information to some third-party API service, the bank cannot fully identify the client and thus the bank violates bank secrecy. Therefore, we can offer only a solution so far, when a client in the Internet bank uploads its information to a file, and then already manages this information independently, as it deems necessary ”(Vladimir Urbansky). So, you can not watch online all your bank card transactions in a third-party program or online service.

What is the advantage of online systems?

• The online system can send you via sms a notification that a plan has been exceeded for a certain category. What is the point if all expenses need to be entered there manually? Another thing is foreign analogs: you pay for food in the store with a card, and then the online system gets your expense, compares it with your budget and sends you a text message, for example, with the following content: “Attention: You spent 70% of the planned amount on nutrition". It is quite convenient. In the CIS, such a service can not be offered. The maximum that can be done is to spend money on food, then step aside, manually drive all the information into the online system and only then receive an SMS. Agree, absolutely not the effect.
• Access to the online system can be obtained in any place where there is Internet. Dubious advantage (especially considering all the inconveniences), if today there are many programs for mobile systems, tablets and different operating systems that are synchronized with each other with the desktop version of the program.
• Perhaps there are some other advantages unknown to me.

Now let's talk about the shortcomings ...

The main drawback of online systems is insecurity . Let me explain my point of view. Information technology is one of the most rapidly changing markets. New companies and products appear daily, and competition forces many companies to close.

Tell me, what will happen to your data if the company that released the desktop personal finance product suddenly disappears? True, nothing will happen. Maximum - the end of support for your product (correcting errors, adding new features). But, you can continue to work with the program, keep records, plan finances, etc.

If problems occur with the online service, then you risk irretrievably losing all your data in a jiffy. Further accounting will be simply impossible. You can also not just lose, but transfer your financial data into the hands of an intruder (of course, if an online service has been made by a more or less solid company, then the risk of stealing your financial data is minimal).

Look at the examples?

Microsoft last July officially discontinued the support and development of its personal finance accounting program ( Microsoft Money ). Is there a more reliable company you can trust? I don't think anyone has more money. But, it happens. What happened to the users of their product? Nothing. They can continue to work in this program, or transfer data to another similar program. Or start using any service, leaving the program with an archive of all the data on your PC.

Wesabe, a major player in the online personal finance accounting market, recently announced that it is shutting down. In order to understand the seriousness of the situation, something should be clarified. Wesabe is not a service that was written by a loner "on the knee" (like most Russian-language online systems), or by a group of 2-3 people (the rest of Russian-online systems). This is a project in which a large amount of money was invested by players in the venture capital market such as O'Reilly Alpha Tech Ventures and Union Square Ventures .

What is the reason for the closure of such a popular service with large investments? According to the CEO of this company, the reason is that they cannot ensure an adequate level of system security and reliability (see venturebeat.com/2010/06/30/wesabe-shutdown for details ). Is it worth talking then about the reliability of Russian-language services, for which there is no financial support (99% of services are supported by the personal funds of the developer himself)?

The well-known English-language online service Zibika and a number of others were also closed.

All this suggests that it is impossible to be confident in any company, especially if we are talking about a single programmer, or a group of 2-3 people. Should I trust the finances of such services? Of course, due to the small number of users, one should not expect big problems (although, as is well known, it’s not possible to keep the service enthusiastic for a long time, and minimal server support costs money, which is very hard to get from free online systems). On the other hand, one should not even wait for a large number of users, since Russian-language online systems cannot offer the main functionality.

findings

Should we enter this market? Is there any market at all? On the one hand, we could conclude a partnership with an already existing system (as this does not require a cent of expenses / investments from us), on the other hand, I still doubt the bright future of such systems. No, it’s not that I’m against online or services in general, but today the legislation and the development of financial services in the CIS countries make it more advantageous and reliable to use desktop systems and clients for various operating systems.

For my part, I am pleased to observe the development of the market for financial instruments, but for now we can continue the conversation in the comments.