‘Online piggy bank’ allows teenagers to buy over the internet

UK teenagers could soon be spending their pocket money online rather than in the corner shop, thanks to a new online service.

Using the Bankiwi service, from social payments specialist Leetchi, teenagers will be able to buy from a range of retailers.

The new service, billed as an online piggy bank, is aimed at under 18s, a group that often struggles to spend online because many sites require a credit card for payment – and that is only available to those aged 18 and over. At the same time, points out Bankiwi, this is a group with pocket money to spend. Through Bankiwi, they can do that with what the site describes as an “age appropriate” group of retail websites.

Unveiling the service, Leetchi described adolescents as the “big losers of ecommerce.” “More than 80% of British adolescents receive pocket money on a regular basis,” said a spokesman. “All in all, they have more than £2bn at their disposal every year.

“Additionally, the majority of teenagers spend time online several times a week. Nevertheless, adolescents are often left behind when it comes to spending their money online. Even if their purchasing power is considerable, there is often no way for them to pay online.”

Parents and relatives can pay money in either over the internet or by phone, making either regular or one-off payments. Account holders cannot spend more than their balance. The service is backed by payment acquiror Crédit Mutuel Arkéa, with security through SSL and 3D-Secure systems. Bankiwi also says that it helps users to manage their money.

Our view: While there are alternative ways for teenagers to pay online – Ukash and ecommerce gift vouchers spring to mind – it’s true that many merchants rely on their shoppers having plastic to pay. That makes it difficult for those who don’t at least have a debit card to shop over the internet.

This venture therefore spots a useful gap in the market, offering a service that it’s likely will create a market. More providers are likely to move into this area in the future. Therefore, the launch of this service will no doubt prompt etailers who sell goods aimed at the teenage market to consider how services such as this could benefit their business and widen the pool of potential customers.