Want to teach your kids how to spend responsibly? There’s a new mobile app that enables you, the parent, to set some money aside for your kids and monitor their spending pattern through the app. A Delhi-based fintech firm – First Pay Technologies – has launched a new pocket money app called Junio. Is it worthwhile using the app?
What’s on offer
The idea behind Junio is to make kids comfortable and accountable with money at an early age. The app is targeted at children aged 10-16. Normally, you just give cash to your kids and would not track where they spend the money. But the Junio app is connected with a card that your child can swipe when she wants to make a purchase.
This is how it works. The parent needs to download the app. It comes with a charge card. Every time the child spends by swiping this card, the parent gets the alert on the Junio app. The card is backed by RBL bank and Mastercard.
Once the parent loads the amount on the card, the child is free to spend the money. If you complete a part KYC (Know Your Customer) process, then you can load up to a maximum of Rs 10,000 a month. A full KYC enables you to transfer up to Rs 1 lakh a month. Ankit Gera, Co-founder of Junio says that you don’t need to have an account with RBL bank. You can transfer money from any account using your net banking, debit card or BHIM Unified Payments Interface (UPI). There is a monthly fee of Rs 99. But it is reversed after the first monthly transaction.
The app is available on Google Play store for android users. Apple iOS users will have to wait for some more time.
Also read: Five money concepts every child must learn
What works
Through the app, you can monitor and control your child’s spending. And though your kid can use the card to withdraw the amount from an ATM, you can set the cash withdrawal limit. “It puts children within a budgetary framework and they learn to manage with limited resources (money),” says Rohit Shah, Founder and CEO of Getting You Rich.
In-app tasks may make kids responsible to an extent so as to earn additional pocket-money and save for defined goals.
The anytime cancel feature of the card using the app gives flexibility to parents. It can prevent mis-use during loss of card.
What doesn’t work
Online frauds are on the rise, and like everyone else, your children can be vulnerable too, perhaps a bit more given their age.
If you cancel the card while there is still some balance left in it, you cannot transfer it back to your savings account. You will need to either withdraw or spend the sum, before cancelling the card.
Shah says that just having the app on your phone and a card in your child’s hand, doesn’t mean much unless the parents monitor the spending habits. Else, it might just be the same as giving cash to your child like any usual pocket-money transaction.
Parijat Garg, a digital lending consultant says that for such apps to work, the cash withdrawal limit needs to be kept minimum and children must be encouraged to make purchases through the card. That’s how counselling can be done, if needed.
Should you subscribe to it?
More than children, parents would need to be more responsible, if they wish to use this app and card to teach their children prudent spending habits.
If you keep the pocket money well within control, the Junio app and the charge card can be of use to your child in learning.
A better alternative is open a children’s savings account with a bank. This allows you to deposit a limited amount every month and then give a debit card to your child. Using this card, your child can make purchases as well as withdrawals. “This way, savings in the account will earn interest. Also, they can be introduced to fixed deposits and recurring deposits to save for their short-term goals through banking products,” says Garg. The child would learn other simple, yet essential, banking tasks such as how to read a bank pass book, verify transactions and deposit cheques. Visits to banks are good learning experience for children at a young age.
