Kakao Bank offers service for teens
The online bank of Kakao hopes to help teens learn to manage their allowances and form healthy spending habits with its Kakao Mini service, launched Monday.
“We noticed there was no contactless payment method for teens, “said Harry Song, the deputy manager of the deposit division at Kakao Bank during an online press event for Kakao Mini held at the bank’s headquarters in Pangyo, Gyeonggi.
“Our employees saw a demand for more convenient financial services growing among adolescent students. Instead of coming up with a complicated deposit account product, we concluded that a chargeable payment card would be the best fit, based on their spending patterns and needs.”
Kakao Mini is an electronic payment method reserved for customers between the ages of 14 and 18. Teenage customers can sign up for the payment service with their smartphones and without parental guidance. Only one mobile Kakao Mini card can be opened per person.
In Korea, customers over the age of 14 can legally open a bank account under their name.
Unlike other electronic payment services, customers do not have to open their own bank account to use Kakao Mini since each mobile card is given a unique serial number that can be used to both receive and transfer money, like an account number for a regular bank account.
Other services offered on Kakao Bank cards, such as drawing cash from A.T.M. machines and splitting costs with others, are also available on Kakao Mini.
Since the service is designed to be used by adolescents, there are measures in place to control spending and prevent illicit transactions.
The total deposit amount that can be saved on an account is limited to 500,000 won ($438). Spending is limited to 300,000 won per day and 2 million won per month. Payments only go through designated “clean-zones,” which exclude businesses that are off-limits to minors — namely bars and clubs.
Kakao Bank is not alone in trying to find a new generation of customers. Commercial banks have been introducing debit cards for minors after financial regulators in April lowered the age allowed to use T-money public transportation cards with a deferred payment plan from 18 to 12 years old.
As of September, around 52 million people in Korea were between the ages of 12 and 18, according to the National Statistics Office.
KB Kookmin Bank introduced the “So Young” debit card in September, which offers discounts at businesses frequently used by teenage students. Shinhan Banks’ “Teens Plus Poney” debit card connects the card with the Shinhan Poney money management app to help cardholders track their spending and learn to manage assets.
BY KANG JAE-EUN [firstname.lastname@example.org]
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