Cash App is targeting a new kind of customer: 6-12 year olds

In a bold move to capture a new audience, Cash App, a fintech subsidiary of Jack Dorsey’s Block, is turning its attention to a younger demographic: children between the ages of 6 and 12. This week, the company announced the launch of new services aimed at fostering a financial relationship with Generation Alpha as they grow. Parents will now have the opportunity to set up financial accounts for their children, which will be strictly managed by the adults. Although children will not have direct access to the app, they will receive a debit card linked to their accounts, allowing them to make purchases. Moreover, these accounts can accept peer-to-peer payments from a select group of approved users, such as grandparents, and will have the potential to earn interest up to 3.25%. The initiative is designed to instill a sense of financial responsibility in young users. Kristen Anderson, Cash App's group product lead for Core Networks, emphasized the importance of early financial education. She remarked, “We’ve observed a strong desire from our customers to introduce their kids to financial experiences at an earlier age.” The program also includes an “allowance” feature, which enables parents to automate transfers to their child’s account, facilitating lessons on savings and financial goals. Upon reaching the age of 13, children can transition to their own Cash App accounts, provided they receive parental approval. At this stage, they will gain access to a wider range of services, including cryptocurrency trading and stock investments, although these transactions will still require adult oversight until they turn 18. Currently, Cash App boasts approximately 5 million active teen users, according to Owen Jennings, the executive officer at Block. Other platforms, such as Step, also cater to under-18 users, and recent scrutiny has been placed on influencers like MrBeast for their efforts in the fintech space aimed at youth. Advocates argue that these services promote financial literacy, while critics express concerns about potential negative impacts on young users' financial habits.