Information Systems Make Children's Savings Programs Work. Here are Three Things You Should Know About Them.
As we note in Investing in Dreams, Prosperity Now’s soup-to-nuts guide to designing effective Children’s Savings Account (CSA) programs, proper management information systems are critical for making CSA programs work.
Given that savings accounts play a central role in all CSA programs, each program must have a reliable and user-friendly system to track account activity, manage incentives and report account balances to participants. While working with communities on their CSA programs, our Children’s Savings team is frequently asked: what kind of account management system should we have in place and what kind of management information system (MIS) options are available to CSA programs?
To learn more about the current landscape of CSA information systems, Prosperity Now, in partnership with the City of San Francisco’s Office of Financial Empowerment (OFE), hosted the CSA Information Systems Summit in mid-March on this topic in San Francisco. The one-day summit was a unique event that brought together an experienced group of CSA practitioners along with representatives from a range of financial services and financial technology firms that support (or are interested in supporting) CSA programs.
At the summit, participants engaged in a series of facilitated discussions that explored the primary information system needs of the CSA field, the marketplace of CSA information systems, how they integrate with account products and the extent to which existing or new information systems and account providers are meeting (or could meet) the essential needs of CSA programs.
Here are a few of the key takeaways:
A range of management information systems are used across the CSA field
At present, CSA practitioners use a variety of MIS to manage their CSA programs. These include everything from Excel spreadsheets, to software platforms (such as Outcome Tracker) that were designed generally for matched savings programs, to custom-built platforms designed by financial industry firms that serve their products (such as those offered by Citi and my529)
Practitioners are relatively satisfied with their MIS, but they want more functionality
Based on an informal survey of summit participants that we conducted prior to the event, most respondents (72%) said that their current information system integrates well or moderately well with their current account program. At the same time, respondents noted a variety of functions they feel are missing from their MIS:
- Automated transfers of incentives upon completion of “milestones” by participants
- Linking accounts from multiple banks or financial institutions to one MIS platform
- Mobile-friendliness, notifications pushed out to participants through email or text, or the general ability to communicate with end-users
- Online customer interface available in Spanish or possibly other languages
- Dashboards for school administrators, financial institution partners and other users
Customization across the CSA field benefits participants, but is a challenge to financial services providers
One of the exciting trends in the CSA field is that the growing scale of CSAs—now more than 380,000 accounts across the U.S.—is attracting increasing interest from firms in the financial services sector. Yet, as we learned at the summit, the lack of standardization across CSA programs presents a challenge for private sector providers interested in designing appropriate products.
The summit was just one way Prosperity Now is encouraging the growth of a more robust CSA marketplace, given that securing an appropriate, low-cost, user-friendly account platform continues to be one of the key barriers to starting a CSA program. Going forward, we plan to share more detailed notes from the CSA Information Systems Summit, organize additional conversations to discuss information systems needs in the CSA field, and encourage partnerships between information systems providers/account providers and CSA practitioners eager to innovate in this space.
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