How Do I Demonstrate ROI To My Board And Executive Team?

At MX, we know that account holder interest in digital money management is not enough to justify investment by most financial institutions.

That's why we walk through a detailed ROI calculation with each prospective client to demonstrate tangible benefits and provide them with the tools necessary to make the business case.

The core of our calculations come from third-party research firms. For instance, Forrester Research finds that digital money management "generates a series of benefits, rather than one big one." The biggest returns come from cross-selling additional products and reducing customer attrition.

Most importantly, it's a matter of who FIs are retaining and cross-selling to — their most affluent and profitable account holders.

Javelin Strategy & Research notes that digital money management is a "magnet for consumers who monitor and manage their finances vigilantly. That list is topped by Moneyhawks, who actively use online banking, mobile banking and pay bills through their primary FI." Moneyhawks represent the most profitable account holders for an FI; more than half of the consumers who use bank PFM tools are Moneyhawks. While they only account for 13 percent of the population, Moneyhawks control a staggering 41 percent of deposits and a third of investable assets.

Digital money management users as a group are wealthier (household income approaching $92,000, 18 percent higher than non-users), have relationships with more FIs and manage more accounts, presenting greater opportunities for generating revenue. Javelin finds that they're more likely than non-users to own deposit accounts, "borrow through credit cards, mortgages, car loans and student loans and invest in retirement and brokerage accounts." They also contribute to interchange revenues, as they're more likely than non-users to "charge purchases to a credit card (52% vs. 36%), swipe a debit card (46% vs. 24%), or pay with a prepaid or payroll card (10% vs 4%)."

Once these highly profitable customers begin to rely on digital money management they're less likely to switch financial institutions. When users aggregate their accounts and start managing their money at a financial institution, those users become increasingly loyal. They don’t want to switch FIs and lose their financial history, including spending trends and budget settings. Our ROI demonstration begins by comparing an FI's normal attrition rate with the reduced attrition rate that can be expected when partnering with MX. Customer retention drives huge savings; Callahan & Associates has found that the average cost to acquire a new checking account is $442.

As account holders aggregate their external accounts to MX's platform, financial institutions can target them with lower interest rate offers, both benefiting the customer and expanding their relationship with that institution. According to Forrester, financial institutions that "use insights gained from money management to deliver more relevant offers or personalized marketing messages should be able to cross-sell more effectively and increase the average number of accounts per customer." Imagine what just a slight uptick in deposit accounts, auto loans, credit cards and consumer loans can do for the bottom line. By utilizing Insight & Target, MX's cross selling engine, financial institutions can increase the number of accounts held by each customer.

Digital money management reinforces this cross sell opportunity by increasing the amount of time users spend in each banking session. Forrester notes that "after launching its money management service, BBVA in Spain found that users spent twice as long per session as users of its standard online banking service." Longer exposure "gives firms more opportunity to market and sell to their customers."

Investing in digital money management carries other measurable benefits:

Whether the aim is to bolster user retention, seize cross selling opportunities or attract new customers, MX provides financial institutions with the means to get there. We work side-by-side with FIs to measure both the costs and expected returns around each solution they intend to adopt.

Forrester estimates that within one year of integration, 15 percent of online banking users will adopt digital money management. Because of this rate of adoption, financial institutions can expect solid yearly revenues shortly after integrating digital money management—particularly since these users mostly consist of Moneyhawks, who each bring in over $6,200 each year.

To learn more about how MX provides a solid ROI, read the MX Business Case. To walk through an ROI calculation for your financial institution, please contact

Click here to download the PDF.