The well-known online pay service PayPal has recently announced the launch of a new account type called Student Account, a safer method for teenagers to make online payments when shopping online or in stores (using the Student Card), while also offering parents a wide range of supervising possibilities.
The new account type is meant to reduce the hassle that both parents and teens go through every day when exchanging money and, additionally, will allow the youngsters to acquire healthy spending habits by having the chance to be responsible for their own budgets. Also, parents will be able to set up up to four PayPal sub-accounts for each of their teenagers, and can transfer money to these accounts whenever it is necessary, whether it is on a one-time or a repetitive basis.
The accounts of the youngsters and of their parents will obviously be linked, so the latter can constantly monitor the former's financial balance, budgeting skills and spending habits. Moreover, the adults will no longer need to be concerned about credit impact since the newly launched Student Account will permit their offspring to spend only the amount available in their accounts.
“As a parent I understand the challenge and stress of raising kids that are financially responsible,” says Don Fotsch, PayPal vice president of customer experience and design, as well as a parent of six teens, ranging from 8 to 19 years old. “With the Student Account, I know I can give my kids a level of financial independence while remaining on top of my kids’ spending.”
The new type of account launched by PayPal comes with several features that will help teens become more responsible and will enable parents to monitor their balance. For instance, an adult can apply permissions for each teen to specify the way a certain account can be used, or parents' approval may be required whenever the teen receives money through the account.
Furthermore, parents can use their mobile phones to verify the account balance and transfer funds, whereas the teens can easily request money from their parents using a simple SMS. When the designated account reaches or exceeds a predefined amount, parents will also be notified.
Currently, the Student Account is only available in the United States and, just like any PayPal account, users will be able to shop online without revealing any personal or financial data about themselves. More details on the new service provided by PayPal can be found here.