Banking for teens; a new wave by Fintechs is all about tapping the
untapped! With over 2000 Fintechs competing in the digital space,
innovation in every segment seems inevitable. Earlier traditional
banks had acknowledged this unpenetrated market of kids, teens and
tweens as well. They introduced services such as junior accounts to
serve the said market but were unable to bring technology and
innovation to the equation. Parents had to manage all the banking
operations for their kids giving a sense of dependency.
Here’s a fact case that showcases vital statistics-
- Leveraging the fact that India has 15-20 million kids in the age
group of 11-18 who own a smartphone and receive pocket money for
personal expenses, upstart Fyp rolled out a pocket money app and
India’s first holographic card for teenagers.
- Junio, another initiative to serve the teenagers, provides users a
bank issued card as well that works much as an adult plastic card.
- FamPay, a Bangalore based Fintech, provides teenagers lessons
about money matters through gamification along with enabling them to
make online and offline transactions independently.
- Upstart like YPay also provide cashback and rewards on
transactions similar to adult reward system.
- Pencilton introduced the PencilCard, a RuPay debit card for teens
across India that can be activated and managed via the Pencilton app.
Several fintechs are innovating this space by introducing ‘Banking
for teens’ which offers ‘children centric’ products and services. They
aim at allowing children to manage their funds while learning
financial accountability and budgeting at a budding age. This will
provide teenagers with financial literacy who otherwise have limited
options to grasp financial-related concepts. Moreover, it will allow
fintech to develop a market for themselves at an early stage.
Gen Z is the most tech-savvy and technology-driven generation, which
is a stimulus for Fintechs. They specifically target individuals aged
between 15-24. The AI-driven apps allow them to withdraw, deposit,
transfer cash, net banking, UPI payments. These companies also provide
teens with secured plastic cards that enable them to make online and
offline payments without the need for an OTP. Moreover, they also
incentivize by offering rewards and cashback, similar to classic
credit and debit cards.
From a security perspective, parents can customize the usage and
account threshold while receiving insights on expenditure. This
provides parents the chance to teach their children money management
while monitoring their expenditure.
Fintechs are introducing services that are enabling financial
inclusion at multiple levels. Although young, children are the future
of an economy and teaching them money matters at a young age seems to
be a good bet than excluding them.