French startup Pixpay is the first challenger bank to cater to teens, offering a debit Mastercard for cashless payments, news outlets reported on Friday (Nov. 29).
A Pixpay account can be opened by anyone 10 years old or above, and both parents and children can download the app together. Like competitor Kard, Pixpay wants to give teens a way to go digital and ditch cash altogether.
Challenger banks are typically marketed to adults. Rival Lydia allows teens who are 14 years old and older.
Pixpay offers users a customized PIN code to lock and unlock the card, and users are notified with each transaction. There are limits on ATM withdrawals and online payments.
Users can start projects and earmark funds for particular purchases, and parents can define an interest rate and send money instantly from the Pixpay app. Parents can also see an overview of multiple accounts if they have more than one child using Pixpay.
Eventually, the startup wants to allow teens to get paid for particular chores or jobs and let more than one parent manage a child’s account.
Pixpay costs €2.99 per month per card; payments and ATM withdrawals in the Eurozone are free. Foreign currency transactions cost 2 percent in foreign exchange. Other ATM withdrawals cost €2.
The company was started in January 2019 by Benoît Grassin and Caroline Ménager. Pixpay plans to tackle the European market as early as 2021 and target two million customers within five years, according to DutchyCorp Tech News.
Pixpay also has an educational vocation because “teens do not necessarily know what is the value of money,” Ménager said.
The startup has raised $3.4 million (€3.1 million) from Global Founders Capital. This is not the first banking account designed for teenagers. In addition to Kard and Lydia, last year, U.K.- based Starling Bank, a mobile-only bank, rolled out current accounts for 16- and 17-year-olds.