Some AI-driven personal finance apps leave customers wanting more—creating an opportunity for banks

The trend: There’s no shortage of generative AI-driven personal finance management (PFM) tools, but the tools’ shortage of genuinely helpful advice presents an opportunity for banks.

Current state: Though many financial institutions (FIs) are using genAI to personalize solutions, when left on its own, the technology can generate poor and unhelpful advice and mislead customers.

That’s what Wired writer Reece Rogers experienced when he tried two free AI-driven PFM apps to work toward his personal financial goals. 

User experiences: Rogers ended his experiment feeling like AI-driven PFM apps target vulnerable users with little to no savings, and don’t necessarily help them improve their financial standing. Here’s what he experienced:

• Cleo: Rogers found Cleo AI engaging at first, with entertaining moments such as humorous roasts about overspending. However, he felt the app primarily focused on upselling, offering cash advances, and subscriptions rather than meaningful financial advice. Cleo’s guidance seemed to encourage short-term borrowing, which didn’t align with Rogers’ goal of paying off debt.
• Bright: Rogers thought the Bright app was confusing and that the AI provided inaccurate and misleading information, such as claiming the author had lost $7,000 in insufficient fund fees. While it promised to help with debt management, the app pushed Rogers toward extremely high-interest loans through third-party lenders.

Banks’ opportunity: Banks know the importance of PFM tools—a recent study of UK banking customers showed 57% of customers want their primary bank to offer more visibility into their financial standing, and 31% will switch banks if they don’t upgrade their digital tools. And a clear leader hasn’t emerged as a replacement for the now-defunct PFM app Mint.

Banks with robust PFM tools on their mobile apps should target the same demographic as their AI-driven competitors—young consumers who need help budgeting and saving. FIs must make a case for how their tools will actually help these customers achieve their goals. It’s also worth highlighting user reviews and the tool’s usability.

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