Why UK has no Mint (or why I stay clear of financial aggregator sites)?
By Rajkanwar Batra
Mint is a website in US & Canada which aggregates your bank and credit card information. On last count it had 10 million users. Now owned by a big corporation(Intuit), it was started by a 25 year old software engineer Aaron Patzer, and sold for US$170 million within 2 years of its founding.
Yet, for all its popularity across the pond it does not operate in UK. You would think that making it work for UK would take them a few weeks at the most.
So the question is why would they ignore a ready-made market of over 60 million English speaking people?
The answer quite simply lies in the view that local banks have taken towards such financial aggregator sites.
The way an aggregator like Mint would work is that you have to give your login details to a third party. This third party then uses your login details to log into your account on daily basis and collect your information. This information is then transferred to aggregator databases (Note: Mint does not outsource this, but all aggregators in UK do).
In US, the banks are ok with it. They might not like it but they are much more relaxed about it.
UK banks are however a completely different story. Some specifically prohibit it (by including a clause in their terms and conditions) while others are silent about it, but do have generic clauses which prohibit sharing of login details with any one.
Yet a few local aggregators have popped up over time which promise to be the local equivalent of Mint. However, before you go on and handover access to your bank account to one of them please do consider the risks involved:
Somebody can clean your account to big ‘O’
The aggregators like Moneydashboard, Ontrees and Lovemoney assert that their services are read only. Yet the login details they ask you to share, are exactly the same, which can be used to move money out of your bank account! While security procedures in place are no doubt very strong there can never be a guarantee that a hacker could not breach it. In a world were even bank websites get hacked in my opinion this is too high risk to take.
‘It’s not me! Yes indeed its identity theft Darling?’
Closely related to above is the possibility that once the thief has your personal details, they can steal your identity and apply for loans or mortgage in your name. While you might not have to repay these as long as you can prove that it was not you who took them. But imagine the hassle and the cost of restoring your credit rating after something like this happens. Here is what BBC has to say about it:
Banks could disown any fraud on your account
Many banks make it abundantly clear that they are not responsible for fraud in your account if you share your login details with an aggregator. Note, it does not have to be a fraud where your data is clearly stolen from an aggregator. It could be just any garden variety type of fraud. Even if banks back away in such a situation when challenged, do you want to go to the hassle of taking on a major bank in a court?
The risks are high but what about the benefits
Interestingly, for all the risk that you take, the aggregator services are neither reliable nor very useful.
In the rush to copy Mint most UK aggregators have implemented what can best be termed as Mint-minus functionalities. Further reliability of these services is very low. A minor change in bank website results in the service being down for days. As banks now push out two factor authentication protocols more and more banks are bound to be not available to automatic aggregators any way.
Here is the take of Duane Jackson the founder of Kashflow on aggregator services: http://www.accountingweb.co.uk/group-thread/bank-feeds-you-know-theyre-dodgy-right
Sure downloading and uploading your own bank statement would take little extra time, but I personally think that it is a small price to pay for sleeping easy at night.
What are your thoughts. Please leave your comments below. I read and respond to all comments.