Personal Finance space in India is getting the attention it deserves. I have chronicled some of the efforts in this space and you can also see all the posts under the personal finance websites category
The Opportunity:
India has over 300 million households and the household savings amounts to Rs 12,00,000 crore. But there is a huge information asymmetry in Financial Services industry where the sellers have much more information than the buyer. This lack of transparency leads to uninformed financial decisions by educated people also.
There’s a huge market out there. To my mind, more than the big market, it’s the huge potential that’s attracting online ventures in this space.
New Kids on the Block
There are three personal finance portals that has caught my attention. They are InvestmentYogi, iTrust and RupeeTalk.
Overview:
Both RupeeTalk and iTrust provide articles, comparison table on financial products and have tied up with leading financial product companies to sell their products. They appear to be the online channels of the financial majors. Both iTrust and RuppeTalk’s tag lines say that they want to make it simple and easy.
InvestmentYogi has content focused on helping individuals on financial planning, retirement planning and tax planning. It doesn’t sell any financial products but focuses on helping you to learn, share and grow.
RupeeTalk
The reach out mail from RupeeTalk says that they are the first-of-its-kind personal finance web portal with a marketplace. To me, they are just another addition to the 3 million strong financial advisors community with a unique online presence.
I tried to search and compare life insurance on their site. Their database returned a choice of 11 products from 10 different companies for the data entered by me. Good choice, but there are actually 22 companies offering life insurance in India. The comparison chart for the four featured products made my head spin as they were too complicated to understand. (Even though I’ve worked in the Insurance industry for quite some time!!)
Can they make life easier for a newbie by recommending just one product? They can explain why they have chosen that product and I would be willing to believe them rather than trying to understand all the jargon!!
iTrust
iTrust has a similar business model like RupeeTalk’s. But they are more uncluttered, thanks to the lack of ads on the site.
Their “life insurance” search does not ask for the category (term, endowment, etc). Simple search options, but there were only 8 responses. (I repeat, there are 22 life insurers in India) . The “Compare” option does not really help a newbie to decide on which product to choose. Again, can iTrust decide and tell me which one is the best and why?
InvestmentYogi
InvestmentYogi has the most disruptive business model, to my mind. That’s why they are not making money right now! 
They are producing a lot of content related to 5 different topics: Taxes, Investments, Planning, Spending and Insurance
The articles are written in a very unbiased manner and they do not push any products. Their goal is to promote a holistic financial planning approach to investing and managing wealth. They also have an ask the expert section where anyone can ask a personal finance related query to their experts. The QnA is posted for everyone’s benefit. Link
As the regulators have started cracking down on high up front commissions and other hidden costs the market will slowly and surely move towards an advisory and portfolio management model since the distributors have no incentive to promote one product over another. And InvestmentYogi would be right there when the recommendations of the D Swarup Committee on Investor Awareness and Protection, of No-load structure (all retail financial products should go “no-load” by April 2011) is approved. This will remove the bias of selling products with the highest commission.
My Take:
It’s good to see such initiatives in the online space as being done by RupeeTalk, iTrust and InvestmentYogi. The personal finance vertical has a huge potential. The online ventures in this space have a responsibility to reduce the information gap between the buyers and the sellers of financial products. So, to my mind, there’s a case of these companies to collaborate and build the financial awareness in India. (Rather than compete with each other)
Do you agree?
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