Digital piggy banks the new cash cows

From piggy banks to accounts in commercial banks and now on mobile apps, junior accounts are going digital as telcos look to their next customer base.

Until recently, children saved cash in piggy banks or in physical banks with junior accounts that limited withdrawals.

Now, African telecom operators are reimagining these accounts, lining up digital junior wallets to allow those below 18 to transact over their smartphones.

Kenya and Zimbabwe are leading the way. Kenya’s giant telco Safaricom launched M-pesa Go on November 26, targeting teens and preteens. With a daily limit of about R50,000, young subscribers can send money, buy goods using pay bills and till numbers, purchase airtime and data bundles, and receive cash from other subscribers or bank accounts.

Safaricom restricts minors from withdrawing money, accessing credit, and making payments to betting companies and political parties. “For the withdrawal feature, one requirement is a minimum age of 18,” said Safaricom. Its M-pesa app had eight million downloads in two days.

In Zimbabwe, Econet has announced a “positive” reception for its Ecocash Junior wallet, routed from the country’s largest mobile money platform, Ecocash.

It allows children to keep pocket money in a digital wallet, make airtime purchases, and buy goods and services with a daily transaction limit. This wallet is targeted at children between 9 and 18 years.

GSMA’S The Mobile Economy Subsaharan Africa 2021 report shows young children aged below 15 years old account for 40 per cent of the Sub-saharan African population. The report also reckons that young consumers owning a mobile phone for the first time will remain the primary source of growth for entry-level smartphones.