The Rise and Rise of Fintech Teen Apps

I was shopping for daily essentials in a store a few days ago. I was in line to get my billing done, but what caught my eye was a slim teen boy in front of me.

"Rs 235," exclaimed the billing officer, and it raised my eyebrows when he paid the bill with his own personalized teen prepaid card bearing his name 'Mayank' printed on it.

I decided to look into the growth of these fintech cards and investing platforms out of curiosity and it did surprise me.

So, in this piece, we'll look at the new wave of fintech companies that are launching full-fledged debit prepaid cards for teenagers and processing transactions worth crores each month.

What is the function and purpose of this app?

Prepaid Cards — Unlike in the US, where it is typical for teenagers to work in restaurants, supermarkets, and other places and learn how to manage money at an early age, India does not have such a tradition.

However, these fintech apps are breaking down barriers by providing teens with an app to make online and offline purchases — with the help of the country's only numberless card — for offline transactions after getting parental consent.

These plastic cards can be customized (in terms of design and name) to meet Gen Z's style. From parents' perspectives as well, they can transfer money into their children's accounts without having to link their own bank accounts. Also, because parents have control over setting spending limits, these prepaid cards  provide their children more independence while preventing the risk of overspending.

Many parents believe that practical experiences will help their children become financially responsible.

Investing Apps — We witnessed one of the craziest bull runs ever during the pandemic. The FOMO and eagerness to participate in the growth story of India through direct equity caused an exponential rise in the number of retail investors and the number of Demat accounts opened in the last two years is a clear reflection of the same.

Following the trend, there was FOMO among teenagers over not being able to buy in that hot stock or in their favourite startup's IPO. However, with the introduction of investing apps for teenagers, they can now invest in all of this and see their money grow.

The good news is that teens invest through their parents' Demat Account; the money is added by the parents, and the parents give final approval to buy or sell any stock.

In conclusion...

In India, there are more than 250 million teenagers. So, building a community of financially aware kids who will go on to make better financial decisions in the future is critical, and we can only hope and pray that these fintech apps will lead the charge and ensure that this happens.

Moreover, we at Finlight are doing our little contribution to make India financially literate through social media content. We have a 400K+ plus community on Instagram (@finlight.in, @financial_litearte, @ financialguide_).

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