UBank uses machine learning in new spending tracker

UBank is making the move into Open Data and leveraging machine learning to give customers a complete picture of their finances

UBank is embracing the industry shift to open data banking through a partnership with Australian fintech, Basiq, leveraging machine learning (ML) to give customers a more complete picture of their finances.

The partnership hopes to offer customers predictions of future spending behaviours just by using their UBank app by 2020.

This follows UBank launching its third artificial intelligence-based customer assistance offering earlier in the year, and what it claimed was the first digital human home loan application assistant. Dubbed ‘Mia’, short for my interactive agent, the offering is built on digital human technology created by New Zealand company, FaceMe. It taps into IBM’s Watson AI engine and designed to help consumers answer real-time questions during the home loan application process.

Basiq, an Australian startup, will enable the first step of the new machine learning experience. Powered by an ML model and combined with several external data sources to enrich historical banking data, the partnership means UBank will give its transaction customers more detailed and accurate spending insights across 40 categories including tech and gadgets, cafes and restaurants, transport, rent, and holidays and travel.

Within each category, customers will be able to see the total spend number and every transaction within a certain period across the category. They’ll also be able to see detailed spending by merchant, clarifying how much they really spent at the local pub or on their beloved pets over the past month.

To get started, UBank customers can use the in-app budget tool to enter their fixed costs like rent, how much they want to save and bills, and even buy now, pay later purchases. Like a fitness tracker that matches the current status against a daily goal, the budget tool shows a single, real-time number of how much to spend each day. It also automatically adjusts to help keep the customer on track, even when they overspend. 

Next year, UBank’s goal is to enhance its partnership with Basiq to help customers avoid bill shock by predicting their upcoming bills. It also aims to help customers adopt positive spending behaviour by predicting how much they are likely to spend by the end of their pay cycle, after each transaction. Ultimately helping customers to more confidently hit their savings goals or just control their spending.

“Budgeting is still a need that is widely underserved,” UBank CEO, Lee Hatton, said. “What used to be tracked in unwieldy spreadsheets or ledgers – if it was tracked at all – can now be tracked in a simple app. Giving Australians richer insights into their spending data means they can make smarter decisions without lifting a finger – it’s how we can truly set them up for success.”

Recent research commissioned by UBank revealed 84 per cent of Australians are unaware of monthly household expenses like bills and utilities, while 85 per cent are unaware of what they spend each month on entertainment. Through the partnership with Basiq, UBank’s effortless Budget tool will help customers automate the drudgery of manual efforts usually tied to budgeting. It ultimately enables them to be smarter with their money – whether they’re aiming to save more toward their goals or spend more responsibly each pay cycle.

“UBank is the first in market to leverage Basiq’s platform to apply advanced machine learning algorithms and help customers understand how they’re spending their money,” Basiq CEO, Damir Cuca, said. “It’s an important tool for helping customers meet their financial goals.

“We love partnering with an organisation like UBank that really gets the power of data in an entirely new way to help customers make smarter financial decisions.”

Along with the partnership with Basiq, UBank is now offering a first-of-its-kind feature catered specifically for the booming collective of gig economy workers. The feature allows customers to input multiple income streams and maintain just one budget, instead of having to navigate their spending and saving in fractions.

With more than one-third of the global workforce expected to be part of the ‘gig economy’ by 2023, and over a million Australians holding second jobs, this is the first budgeting solution to address the underserved needs of this growing market and really offer them a valuable tool.

Customers can use the UBank app to add as many income streams they have, whether it’s a one-off part time job, or an ongoing side hustle. This allows everyone from ride-share drivers and weekend waiters, to academic tutors and swim instructors to get the full picture of their total income for the first time, no matter how many jobs they have. Customers can add multiple income streams with one tap via the budget tool, enter their fixed ongoing costs like rent and bills, and know how exactly how much they can spend every day until their next income.

“We’re living in the era of the side hustle, which means we need to factor in the reality of more intricate financial management. With this in mind, we’re committed to making financial decisions easier for every Australian,” Hatton said. “That means we have to factor in the reality that 7 per cent of our population now faces, holding more than one job and having to more closely manage their day-to-day finances. If we can automate this for them, it’s one less hassle in their day.”

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