NerdWallet’s Big Ambitions: Personal Finance App Aims for Dominance

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eight financial institutions: American Express, Bank of America, Barclaycard, Capital One, J.P. Morgan Chase, Citibank, Discover, and U.S. Bank. The limited advertising on the site includes “featured offers” from some of these partners.

In addition to credit cards, NerdWallet rates checking and savings accounts, mortgage loans, online stock trading sites, and auto, life, and health insurance policies. Its NerdScholar section offers guidance on college loans and other financial decisions faced by young people starting their careers.

NerdWallet visitors can also type in specific questions, which are answered free by experts such as CPAs. The experts, in turn, can showcase their skills, and NerdWallet offers links in case visitors want to get in touch with them.

At this point, users are not required to register on the site, and NerdWallet doesn’t collect data about them, Chen says.

“We should give users as good an answer as possible without [personal] data,” Chen says. Answers can be more precise, though, if the visitor shares some details, he says. “People can interact as deeply as they want to.”

Visitors looking for bargains can go to NerdWallet’s Dealfinder page, where merchants display sale items such kitchen appliances, cameras, and consumer electronics.

What this all adds up to is a lively e-commerce site as well. But Chen is hoping to set NerdWallet apart in the personal finance sector as a service that puts the consumer’s best interests first. The mission stems from what he learned back in early 2009, when he was researching credit cards for his sister.

The companies selling financial products such as mortgages and car insurance would rather launch a sales pitch than offer up detailed information for objective comparisons, Chen says.

“Once you start informing people, you start making much less money per person,” Chen says. To get data for product comparisons, NerdWallet mines databases such as company filings with regulators to gather information that companies don’t share more widely.

“Our ethos is to be the source of clarity for all of life’s financial decisions,” Chen says.

In its advertising disclosures, NerdWallet says it ranks credit cards based on “objective quantitative and qualitative analysis” that is unaffected by the compensation it receives from its banking partners. But compensation may influence some of NerdWallet’s practices, including the choice of cards featured in its articles and reviews, and the order of products shown on the site, the company says.

Not unlike many news publications these days, NerdWallet is consciously grappling with the balance between the independence of its editorial content and the needs of the business side of the house.

NerdWallet has organized its staff of experienced writers and editors within a traditional newsroom structure, which includes rigorous copyediting and adherence to journalistic ethics, Chen says. But this content organization also works in collaboration with business staffers whose priority is to make NerdWallet profitable. This wouldn’t usually happen at a traditional newspaper, where the advertising staff can’t select or modify news stories, for example. But those lines can now be blurred even at legacy news outlets as they seek to replace traditional revenue sources that have eroded in the online publishing era.

Chen says there’s an ongoing in-house discussion about NerdWallet’s mission to put consumers first and maintain their trust. To act on this goal, the company might choose to take lower fees from a bank in the short term if it means consumers will keep coming back.

“You’re optimizing for the short term if you’re selling consumers something that’s not good for them,” Chen says. “Our strategy is to become reputable so that people refer others to our site.”

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