To give her 11-year-old son Artur more autonomy, civil servant Ligia da Costa decided to open a bank account for him. A year later, he believes his decision was the right one: today he sees his son risking some investments, talking to his account manager, paying for games himself and recharging his cell phone. And one point that reassured her was that only cash transactions are allowed with the balance he has in his account (from the deposits he makes). In addition, she is warned about any movement that the child makes. “Children can invest too, children are people too,” Artur says.

According to forecasts from financial institutions, Artur’s account is one of approximately 10 million minors in Brazil today. This is one of the niches that has grown the most in the country, and traditional banks and fintech companies are becoming more and more interested in this niche. According to the latest data from the Central Bank, there are 23 million accounts opened among young people aged 15 to 24, a 50% increase over the past decade.

This expansion reflects a new way for financial institutions to look at the public. In addition to being interested in banking relationships earlier and earlier with their customers and thus bypassing the growing competitive environment, this move was mandatory to meet the needs of an increasingly digital world.

“In the past, children were simply given money to make transactions and buy what they needed, but in the digital world, they need a wallet or bank account that allows transactions in the digital and physical world. This means that the old rules restricting adult bank accounts are impractical and exclusionary,” said Brett King, author of Banks 4.0, who was a financial technology policy adviser in the Obama administration.

for babies

Under British Columbia regulations, minors may have accounts provided they are represented by their parents when they are under 16 years of age. In this case, the opening agreement is signed only by responsible persons. Between the ages of 16 and adulthood, father and son sign a contract. Another change in the rules that expanded this market was documentation: today the CPF number is already on the birth certificate. Thus, even a newborn can have an account in the country.

Ricardo Urada, who is responsible for developing the Next business line, Bradesco’s digital bank, says the house’s product, called Next Joy, launched in 2020, has more than doubled in size year on year. The decision was made to offer this type of account to parents and guardians who already have a digital bank account. With connected accounts, a parent can program benefits for their children or set tasks, such as homework, in exchange for a reward.

“It’s a way to start a relationship. Banks are throwing the net further and further and expanding their market. We’re thinking long term, starting to understand this client now so we can reap the rewards in the future,” says Urada. Next has a partnership with Disney. The idea is that using characters makes the process fun for kids.

Digital bank C6, in turn, launched the Yellow account to make its product shelf more complete, says Maxnown Gutierrez, responsible for products and individuals at C6. Responsible persons must also have a bank account associated with the child’s or teen’s account.

“The strategy to be a full-fledged bank and concentrate relationships within our platform involves working in a family,” says Gutiérrez. One effect that has already been seen when a father opens an account for his son is that his involvement increases as he ends up logging into the banking app more often.

Goals

Gutiérrez’s eight-year-old son Theo has a Yellow account. He says the C6 allows the small to set financial goals: in Theo’s case, the goal is to buy a computer by the end of 2023. Each month, the manager contributes 150 BRL, which Theo invests in his own bank’s CDB. The investment can start from R$10. The child can choose to have their own name or nickname printed on the card. A fan of the Naruto anime, Theo chose the character’s last name: Theo Uzumaki.

In March, Itau launched an account dedicated to the world of gamers called Player’s Bank, originally intended only for people over 18 years of age. “Once we launched, there was a need to lower the bar,” says Ricardo Scussel, who is in charge of the food zone at Itaú Unibanco. This is how the starter account was launched in August, with 100,000 opening requests. “The gamer community is very large and we were able to connect,” he comments. The father does not have to be the owner of the Itaú account.

According to banking innovation specialist Bruno Diniz, all this personalization to attract kids is the right thing to do. According to him, the bank’s adult interface was not attractive to young people, and it was determined that the product needed to be more relevant to the new target audience. “After that, this client will be able to develop within the institution.”

Financial planner Vanessa Guimarães says opening a financial account for minors can be a way to encourage savings and control spending. “It’s an opportunity to encourage people to save some of their earned, accrued benefits and even encourage investment.” Vanessa also gives advice to parents who want their children to be good with their resources: give a bonus, which can be annual, depending on the total balance saved.

WHO ALREADY OFFERS

Next joy

Service fee: free

Withdrawals: free and unlimited

TED/DOC: free and unlimited. Make Pix allows you to schedule your deposit and customize the app with Disney characters. There is a debit card. Responsible person must have an account Next

C6 Yellow

Service fee: free

Withdrawals: free and unlimited

TED/DOC: free and unlimited. It makes Pix and has a customizable debit card. Allows you to register benefits and create goals for the future use of money. The application sends an SMS about the expenses incurred. The responsible person must have a digital bank account. Offers investment in CBD

player’s bank

Service fee: free

Withdrawals: free and unlimited

TED/DOC: free and unlimited. Do Pix. The balance gives 100% CDI. Access to discounts on video games. There is a cashback and a card that can be personalized. from 14 years old

inter kids

Service fee: free

Withdrawals: free and unlimited

TED/DOC: free and unlimited. Do Pix. Allows you to control the responsible person who does not need to have an account in the institution. It offers low risk investments such as CDB. Have a debit card

Nu Kids / Nu Teens

Service fee: free

Withdrawals: free and unlimited

TED/DOC: free and unlimited. Do Pix. Allows you to control the person in charge through the account associated with the main account. Benefits can be scheduled. It offers low risk investments such as CDB. There is a debit card.

Information taken from the newspaper State of Sao Paulo.