PayPal launches teen account that lets parents track kids' spending
13 August 2009 | 9406 views | 0
PayPal has launched a student programme that lets parents establish a sub-account for their children that they can transfer money into and monitor.
Parents transfer funds into the sub-account when needed, either on a one-time or recurring basis, with children only able to spend what is in it.
The account also comes with a debit MasterCard to use in stores and at cash machines.
Money can be transferred online or via mobile phones with parents and teens also able to check the account balances using their handsets. Parents can also receive alerts notifying them when their teens' payments exceed a certain amount or when a specified low balance is reached.
Because the parents' and teens' accounts are linked, the adult gets a full view of their child's account balance, spending habits and budgeting skills.
Don Fotsch, VP, customer experience and design, PayPal, says the account lets parents give their children limited financial freedom and independence so they can learn to manage their own money responsibly.
Earlier this year e-commerce outfit SocialWise launched a similar system, enabling children to make purchases online by "billing" their parents.
The BillMyParents service lets children mark items they want to buy by clicking a button next to it on participating e-commerce and social networking sites. Parents are then notified via e-mail or text message and, if they choose to, make the purchase with their credit card.
Visa rolled out its own Visa Buxx pre-paid card for teen spending in 2000. Similar programmes have also been launched by major banks, including Citi and BofA.