Individual Development Accounts (IDAs) – the 401(k) style savings accounts for low-income households under consideration by Congress – represent a potentially new product line for financial services institutions. IDA account-holder deposits are matched by public and/or private contributions and earmarked for an asset that serves as a stepping-stone out of poverty (e.g., for a down payment on a home, tuition for post-secondary education, small business start-ups, etc.). Despite early successes, IDAs remain expensive for financial services institutions to operate – losing an estimated $25-$75 per account annually.

Enter SunGard, a global leader in integrated IT solutions for financial services. With software solutions that serve more than 20,000 clients in over 50 countries, SunGard was a logical technology partner for the D2D ("Doorways to Dreams") Fund’s new "Online IDA" product.

Online IDA harnesses technology to allow banks, community organizations, and IDA participants to implement IDAs more efficiently. The heart of that technology is SunGard’s OmniPlus software, a 401(k) record keeping solution that can also be applied to IDAs. Online IDA is currently being test-marketed in Boston, Cleveland, and San Jose.

D2D Fund is a nonprofit enterprise dedicated to helping low-income families gain access to a range of financial services by changing the economics of serving this population.

The opportunity for expansion is substantial. Low-income households present a large untapped sector for financial services institutions. The passing of federal legislation could increase the number of IDAs from 20,000 in 2003 to 45,000 in 2005 and 300,000 by 2011. That translates into support for 190,000 first time homebuyers, 60,000 college and vocational school degrees, and 43,000 small business start-ups.

For more information, please contact Shannon Raley at SunGard at
(205) 437-7797.

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