As Simple begins the 6-month process of converting its 100,000-person wait list into paying customers, I expect much attention will be given to its flagship UI innovation, a forecast of your “free cash” after accounting for upcoming transaction. Simple has trademarked the feature as the Safe-to-Spend balance (screenshot below).

We’ve discussed it a number of times in our Online Banking Report (subscription), but we haven’t explored it in Netbanker. Here’s why balance forecasting is so important:

• Intuitive UI: Hundreds of millions of people worldwide log in to their bank accounts at least weekly. Why? To see their balance and to make a mental calculation of whether things are on track. Whether they consciously think it or not, they are making their own calculation of what’s left in the account to spend. And given how horrible the average person is at making complex math calculations in their head, it makes so much sense to put that number right in from of them at all times.
• Advocacy: Doesn’t everyone want to believe that the place where they entrust their live savings is looking out for their best interests? But events of the past five years have seriously eroded consumer confidence in financial institutions, especially large banks. Providing a new tool that really helps consumer understand their financial position, and reduce the chances of overdrafting, could go a long way in restoring confidence that the bank is not the enemy.
• Gateway to advanced PFM services: Doing important calculations on the consumer’s behalf is what PFM is all about. So showing that you have the wherewithal to make this important calculation, can be the entry point for delivering more advanced PFM services, hopefully at a profitable monthly fee (note 1).
• Great competitive weapon: Want to compete with Bank Simple? Want to show you are ahead of the curve. This is a perfect, tangible feature/benefit.

Bottom line: This is not the easiest feature to add. Maybe one of the hardest. And you should expect to spend quite a bit of time explaining it to employees and customers. But it absolutely will be part of every online banking system and third-party PFM service (see also, HelloWallet’s “left to spend below).
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Simple makes it impossible to miss your “Safe-to-Spend” balance (22 June 2012)

HelloWallet’s mobile app has a “Left to Spend” balance for both in total and for the specific budget category (22 June 2012)

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Note:
1. We are putting the finishing touches on an update of our PFM report (May 2010, subscription). You’ll see an announcement here next week.