#FinancialInclusion / These startups want your kids’ allowance

Millennials and Gen Z are already prized markets for challenger banks. But competition is heating up in an increasingly crowded arena, so fintechs and investors are looking for even younger customers — including children who just started getting an allowance.

[Taylor Burton, co-founder of Till:] "There’s this big fight for top-of-wallet, but we’ve also forgotten about the kids who have no wallet… We’re not just trying to put a kid’s face on a debit card similar to putting a name on the back of a backpack. We’re focusing on respecting these young people as the financial actors they are."

Investors are backing this search for kids’ cash. Till just raised $5 million. Greenlight, which launched in 2017, raised $260 million in an April round from investors led by Andreessen Horowitz, almost doubling its valuation from $1.2 billion to $2.3 billion. The same day Greenlight announced its fundraising, a new player, Step… said it secured $100 million…

[Charlie Javice, founder and CEO of Frank, a student financial education company:] "Students and young people are sexy and it’s in vogue. … [But] you have to go younger."

Most of the startups offer digital banking accounts tied to debit cards. Parents open the accounts with their kids and use apps to disburse allowances as well as track and even set limits on the way their children are spending the money.

Sheehan started Greenlight because he wanted an easier way to give his kids cash for field trips instead of doing last-minute runs to an ATM or having them borrow from friends. He said giving children an early taste of what it’s like to save, spend and even invest is helping them become more financially literate…

https://www.protocol.com/fintech/digital-bank-accounts-kids