With money becoming increasingly digital, it is imperative for children to learn the basics of personal finance. Yet, younger generations seem to be ignored by traditional banks. It is quite common for children to borrow their parents’ cards to make digital payments.
Due to this, children are only left with cash in their hands. Using cash, it can be difficult for children to know how much they are spending. In fact, a recent Northwestern Mutual study found that over half of Gen Zers don’t know how much money they have in their savings account.
However, recently several companies have been stepping up to provide Gen Zers with their own digital bank account.
UK-based fintech company Revolut recently launched a banking app for children aged 7-17. Called “Revolut Junior,” the app is designed to give children the freedom to manage their own money and build financial skills for the future. The mobile app comes with a spending card which children can use to make payments.
For safety reasons, only parents are able to set up an account for their children. Parents can also set spending limits, deposit money to the account, and always have access to other security features.
With Revolut Junior, parents also receive instant notifications whenever their child makes a payment, including information on where and how much.
US-based startup Greenlight provides a special mobile app experience for children to build financial habits from early on. The Greenlight mobile app comes with a preloaded Mastercard debit card for kids over the age of 13. Parents are able to control where their children spend, set withdrawal limits as well as savings goals.
An interesting feature that Greenlight has come up with is called chores. It is a one-time reward system that parents can use to incentivize their children for completing basic tasks. So, whenever a child washes the dishes, cleans their room and so on, parents can reward them by sending them money.
Kard is a French challenger bank that is targeted at Gen Z. Teens that sign up to Kard will get their own international bank account number (IBAN) as well as a Mastercard debit card. Only parents can set up an account for their child.
In the app, children are able to check their expenses and make money transfers to other Kard users. In the near future, however, users will also be able to round up their expenses to save extra money, as well as make donations to non-profit organizations.
For parents, instead of tracking their child’s transactions, they can limit their spending by transferring money to the card only when they need it.
US-based fintech Step is another company that aims to teach children the basics of personal finance.
Step combines a mobile app and a debit card that teens can use to make payments. In the app, children are also able to track their expenses and manage their money. Parents are able to set spending limits and connect their own bank accounts to Step to deposit funds to their child. What is more, children are able to receive money instantly to their accounts from family and friends.