NZ app SquareOne teaches children good money habits
A New Zealand app to teach children about money is aimed at the recent generations of cashless parents.
SquareOne’s two co-founders had careers in financial services, and were nudged into creating the app when their own children were at the age of discussing pocket money and bank accounts.
‘‘The only thing our kids have ever seen is mum and dad just tap a card, and you get what you want 24/7,’’ said Jovan Pavlicevic.
Without hard cash, for example coins for a piggy bank, it was difficult to teach money lessons, so Pavlicevic and Jamie Jerman came up with the idea of an app to foster good financial habits using a debit card instead. ‘‘For millennia there has been some sort of physical medium of exchange and suddenly that has gone in one generation.
‘‘How do we teach our kids the value of a dollar and where a dollar comes from, and how much effort it takes you to earn that?’’
Once the app is downloaded, and parents set the level of control they want, children are issued a Mastercard debit card bank account number.
Since launching in November, SquareOne has signed up 45,000 customers, beating the first-year target of 30,000 in under seven months. The pair expect customer numbers for the year to hit 100,000.
The card has no details on it aside from the child’s first name and the Mastercard and SquareOne logos, reducing fraud risk.
It is not a credit card, so cannot go into debt, and cannot be used at R18 stores such as liquor outlets. Parents receive push notifications for each transaction and can set parameters such as how much can be spent and if online spending is allowed.
As well as providing incentives to save, there are lessons wrapped around financial wellbeing such as goal setting, negotiation and delayed gratification.
SquareOne is not a bank but it is registered as a licensed financial services provider and is part of the dispute resolution service Financial Services Complaints Ltd.
The longer-term goal was to grow with its customers and eventually offer financial services products to the whole family, Pavlicevic said.
A lot of work went into tackling financial literacy but SquareOne positioned itself as growing financial capability, building up good financial habits and not just gaining knowledge. ‘‘You are actually able to earn $1, put that dollar to work in the real world and connect the dots right through from OK, how hard is it for me to empty the dishwasher? And then is that toy in the Warehouse worth 10 dishwashes?’’
The company was focused on New Zealand at present and was growing its own capability, and would then expand overseas, he said. ‘‘And with the MasterCard partnership, that is a pretty key piece for us.
‘‘And we can leverage that to a lot of countries globally.’’