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Fintech for Kids and Teens: A Hot Market to Tap

Anastasia TimoshenkoAnastasia Timoshenko
Anastasia Timoshenko
Senior IT consultant for FinTech and Banking Solutions
February 7, 2023

Did you know that TikTok content with the hashtag #Investing has over 10.5 billion views, while #PersonalFinance videos have over 7.7 billion? This financial content niche, known as FinTok, shows that younger generations are increasingly interested in money topics, especially after the pandemic heightened concerns about finances and job security. In response, fintech for kids is emerging to help Generation Z and Generation Alpha manage their money more effectively through financial apps for teens and kids financial apps.

Brief market overview

As per the most recent UN estimations, children under 18 years old constitute up to 25 % of the world’s population, or 2.4 billion. Gen Z and Alpha are increasingly interested in utilizing the fintech for kids opportunities, whether through online applications or in-store using contactless cards or fingerprint authentication. As per recent study in the UK, even pocket money is becoming digital: a significant 43 % of parents go for bank transfer to give their kids petty cash. Notably, over the recent years, investors infused over $500 million into financial apps for teens and their parents with top kids financial apps like Greenlight (4 mln), GoHenry (2 mln), Step Mobile (4 mln).

Far-reaching benefits of fintech apps for children

Besides the opportunity to capitalize on the new niche, there are numerous advantages to empowering the youth with tailored financial apps for kids. The same survey reveals that nearly 60% of parents acknowledge that their kids are unfamiliar with the prices of common grocery items, highlighting a gap in financial literacy regarding everyday expenses. Hence, modern teen finance apps can help instill confidence and knowledge that will serve them well in the future.

Promoting financial literacy

Many children lack financial knowledge and are challenged with simple tasks like understanding a bank statement or making a transfer, which is a barrier to economic advancement. Fintech for kids brings these skills at their fingertips raising financially secure adults and ensuring their long-term financial success.

Creating lifelong customers

Fintech companies that manage to build loyalty by catering to the financial needs of kids and teens through cross-platform app development and other payment software development services can further establish themselves as the child’s primary financial institution when they grow up.

Attracting parents

In addition to children, fintech startups may appeal to kids’ parents. For example, neobanks that start offering kids’ accounts or parental control financial app, can strengthen the brand to the whole family and make parents ultimately switch over.

Building a Fintech App for Kids: Key Considerations

Just like any niche products, financial apps for kids have their own set of challenges. From child-friendly design to engaging functionality and parental control, as a financial software development company, we’d like to bring to your attention some specifics described below based on our experience of mobile app development services in the fintech area.

User-Friendly and Engaging Design

Children love bright colours and expect visual and auditory feedback whenever they interact with a digital surface. They are also more imaginative, so the kids financial app’s design needs to give children freedom to explore and stay creative.

Exciting User Experiences

Children are very curious but at the same time they have shorter attention spans. This means that your kids financial app needs to be packed with exciting and innovative experiences like a mascot character or chatbot to keep young users engaged and motivated.

Age-Appropriate Features

In the Play Store and App Store, fintech for kids apps can be filtered by age ranges. That’s because kids develop pretty fast and where one age group requires clear instructions, another may dive right in and go intuitively. We’d advise focusing on a two-year age range and make your app easy-to-use for that group.

Parental Controls

A kids finance app with parental control or kids financial security app are solutions to keep with the times and cybersecurity risks. Regardless of whether your child uses your card or theirs, it’s important to regularly review their spending for any unusual transactions and fraud.

Gamification for Motivation

Scientists say that it takes approximately 400 repetitions to create a new synapse in the brain, unless it is done in play, in which case it only takes 10 to 20 repetitions. The same is true about financial literacy apps and other banking software development services in fintech for kids.

Robust Data Security & Compliance

As software developers, we are crucial in protecting children’s data privacy and safety in kids financial apps. The minimum safeguards should include end-to-end encryption, regular updates and secure login protocols to keep financial apps for teenagers and kids secure.

Top Kids Financial Apps Helping Secure Their Financial Future

GoHenry

GoHenry, founded in 2012, is a kids financial security app for 6-18-year-olds tools to teach money management in a safe environment. Parents can set rules, allocate pocket money, and assign chores while kids can use saving goals, track spending, check balance, manage chore tasks and pay back money to a parent’s account if they borrow funds.

MyMonii

MyMonii focuses on raising good habits and increasing financial literacy. With the MyMonii app, kids may make instant payments, utilize MyMonii Visa card, set finance-related goals and priorities to spend their money. Similarly, to other financial apps for teenagers, MyMonii envisages parental control for fixing transfers and tasks for their kids.

Osper

Osper functions as both a mobile banking app for pocket money management and a prepaid debit card with individual logins for kids and parents. Funds management in Osper is compliant with the European regulations. Being compatible with Android devices, the application also runs as custom iOS development solutions.

Ruuky

Ruuky is a German neobank aimed at enhancing Gen Z’s financial knowledge and skills. It offers a fee-free checking account for teens, a Debit Mastercard, and parental oversight.

Vybe

Vybe app stands out due to its user-friendly interface and smart security safeguards. With Vybe, young people may proceed with checking account balances, transferring funds, paying bills, and depositing checks online. The functionality of the teen financial app is also equipped with robust customer support and parental control.

The Future of Fintech for Kids

The fintech for kids market is gaining momentum as parents seek tools to ensure their children are financially savvy. Financial habits can start as early as age 3, making it crucial to introduce financial concepts early on. To address this, fintech companies are launching kid-friendly iOS and Android app development solutions for managing allowances, chores, and more. Elinext has become a go-to fintech development partner for startups and S&P 500 companies that want to disrupt business with top-notch fintech products. Let’s connect to discuss your fintech for kids project!

FAQ

What is fintech for kids and teens?

Fintech for kids refers to a number of software solutions, primarily, kids financial apps, aimed at finance education and enhancing financial literacy of children to manage their pocket money efficiently and inform their respective decision-making.

Why is a financial app for teenagers growing in popularity?

Financial apps for teenagers and kids are growing in popularity with the rise of digital technologies and emerging associated risks. Kids financial security apps are also about understanding the value of money, priorities, security and privacy aspects.

How do financial apps for kids help children develop financial literacy?

Kids’ financial literacy is developed as they navigate through their respective kids financial app tracking their expenses, setting savings goals and priorities, completing tasks from their parents and evaluating their progress in finance management.

What security measures do financial apps for kids use?

Like in custom accounting software development services, kids solutions require adequate data privacy measures like data encryption, secure protocols, etc. as well as compliance with applicable regulatory standards like PCI DSS setting security principles for credit, debit, and cash transactions.

What are the key challenges of building financial apps for kids?

When building financial apps for kids, the primary considerations should be around privacy and security and an interactive learning environment. Software developers should also ensure parental oversight options and age-appropriate functionality. 

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