More than three years ago, Microsoft, Checkfree and Intuit banded together to devise an open framework for transmitting financial information on the Internet.

That standard became known as Open Financial Exchange (OFX) and it established the ground rules for exchanging data between consumers, businesses and financial institutions on the Internet. The theory behind OFX is that it allows the consolidation of different financial relationships into one area, one screen, one website.

Microsoft and Intuit were driven to develop this standard primarily by their two desktop products for personal financial management, Money and Quicken. They needed to jumpstart additional connectivity to banks and brokerages. Prior to

January 1997, Microsoft and Intuit carried out their data connection at a hub center at Checkfree.

"OFX was seen as a way to open up the market more for banks, brokerages and credit card issuers to share data," said Mr Steven Holoien, director of corporate partner development at Intuit.

Since then, about 125 vendors worldwide have signed to work with it, eager to write software around a common standard. OFX version 2.0 was published in April and the specification is available for anyone to download at www.ofx.net.

Recently, the issue of whether OFX has a future has surfaced because of the increasingly popular technique of screen scraping, where an account aggregator can gather a consumer's data off the screen of another company's website, with or without that company's consent. Since OFX doesn't extend into non-financial services, it is not the protocol for an aggregator to consolidate data such as e-mail, weather or airmiles. For the time being, aggregators will continue to scrape from those sites, using HTML to collect the data.

A whole host of new Internet companies have based their businesses around aggregating accounts for consumers. For example, if you want to see all your personal accounts - bank statements, bills, investments, e-mail from different addresses, news, travel and shopping - at one website of your choice, they can do this for you.

The three main companies that scrape screens to get this data are Yodlee, Vertical One and Ezlogin. Yodlee is the power behind the new wave of "MyAccounts" and "MyFinances" services appearing on the Web from financial institutions, portals, Internet service providers, and other online businesses, including Intuit, AltaVista, and freeinternet.com.

These personalised services allow consumers to have summarised views and one-click access to all their personal accounts across more than 1,200 websites. Yodlee does not disclose user numbers but it will in the future, a spokeswoman said. Its customers include Merrill Lynch, Chase Manhattan, America Online, Money.net and Everbank.com.

VerticalOne has 210,000 live accounts and it is working with Security First Network Bank, VirtualBank.com and the Women's Financial Network. Ezlogin.com, which was recently acquired by the wireless software company 724 Solutions of Toronto, has 15,000 registered users and it supports 3,000 sites globally.

As it stands now, OFX can only be used to view banking, credit card, retirement, brokerage, and tax statements, to present bills to customers electronically, and to allow them to pay bills online. The founding companies are also in discussions about aggregating financial data such as mortgages and insurance around OFX.

However, OFX is still viewed by many as being a proprietary protocol with certain limitations. It does not work with another standard called Gold, which International Business Machines and Integrion Financial Network have promoted.

Both standards, Gold and OFX, says Kit Needham, senior director of the Banking Industry Technology Secretariat in Washington , are "incompatible because they are both proprietary and owned by vendors". That's the reason, she says, that the Banking Industry Technology Secretariat brought together the owners of the two standards and has been working to merge these two standards - OFX and Gold - into one called the Interactive Financial Exchange or IFX specification, which is based on XML (eXtensible Markup Language).

"IFX is the way the industry is headed," Ms Needham said. "It builds on the experience of OFX but it gives incredibly more functionality."

Mr John MacIlwaine, senior vice-president and chief technology officer of myHomeKey.com, said OFX was not in widespread use because of the pervasiveness of XML. If OFX was tied in, he said, then the XML protocol would be pervasive for financial services transactions. One obstacle to OFX's adoption, Mr MacIlwaine said, was that it was a proprietary protocol for financial services so companies had been forced to adopt other types of technology.

"The company I'm with is standardizing on XML messaging, which is open and can be customised for business. Microsoft controls OFX and it's not open to the Internet. It has a lot of inhibitors. It doesn't support transactions. Information is mostly in read-only format, so it's not very extensible," Mr MacIlwaine said. One OFX proponent, D.R. Grimes, chief executive officer of NetBank, believes OFX will be widely adopted by the financial services industry within the next 12 to 18 months.

"The philosophy behind the need for OFX is compelling," he said. "Many consumers, particularly professionals in higher income segments of the market, use personal financial management software applications to manage their finances.

"These consumers are extremely interested in Web-based applications that can provide them with more comprehensive information and greater functionality. Both the software and Web-based applications, which will only increase in importance, work best with an OFX interface."

What has hindered adoption thus far, Mr Grimes said, has been legacy systems and indecisiveness. "The sooner OFX reaches critical mass, the more likely it will become the lone standard and reduce the possibility of competing technologies."

Screen scraping, he said, should be viewed as an interim step. "The concept of screen scraping has always been used when new technologies emerge. Standards-based protocols are then developed to utilise the new technologies fully so that legacy systems can be replaced."

Mr Daryn Chapman, vice-president of strategic initiatives at Corillian said: "OFX is on everyone's radar screen now, with many deployments. Widespread use is likely to be two to three years away."

The catch-22, he said, has been that if there were more OFX clients to support, more OFX servers would be deployed, and if more OFX servers were available, then more OFX clients would be deployed.

Mr Jonathan Powers at Chase Manhattan Bank says he sees OFX helping in some areas of aggregation, but does not see it as a "cure all" or complete solution. "We've already seen XML and IFX start to emerge as potential "common languages," he said. "XML is certainly broader and not limited to the financial services industry."