[ 2014-07-22 ]

A first debit card for young people
It may come as a surprise to some parents to
discover that children as young as 11 can now get
a bank debit card. Most are probably more
concerned, however, that their children do not
understand how to manage their pocket money
wisely.

A solution to this has arrived in the form of
Osper, a London-based start-up.

The newly launched service comprises a prepaid
debit card, which is backed by MasterCard, and a
mobile app. The app comes with separate logins for
the young people and their parents, so a parent
can put more money on the card and monitor how
much is being spent. Children as young as eight
can cope with it, the founders say.

Rather than parents handing over cash or lending
their own credit card for online purchases, which
would be illicit, young people can use their Osper
card to withdraw cash from a hole in the wall ATM
or to buy stuff online. Because Osper Cards are
prepaid, your offspring can only spend the money
they have been given.

Osper’s backers include: Travelex chief
executive Peter Jackson; Brett Akker, co-founder
of Streetcar and Lovespace; Index Ventures; and
Horizons Ventures, the venture capital company of
Hong Kong tycoon Li Ka-shing.

The idea is to help parents transfer more
responsibility to their children with regard to
making decisions about money. The big opportunity
for the company, it seems, is to capture potential
banking customers at an early age, although
Osper’s founder Alick Varma insists he has no
plans to become a full service bank.

While parents can put a block on websites and
shops they do not want their children to visit,
the worry now for parents will be wondering how
their children are spending the pocket money they
put on the Osper card.

Source - FT

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