Starling Bank’s new debit card for children: Starling Kite
Leading UK-based challenger bank, announced in a today that it will be launching Starling Kite, a debit card for children aged 6-16 with the freedom and benefits similar to a child bank account. As young people across the UK prepare to go back to school, the card will provide them with a contact-free way to pay post coronavirus pandemic.
Costing £2 per month per card, Starling Kite is linked and charged to a parent or guardian’s personal bank account with Starling. The debit card can be used in-store, online and used to withdraw a maximum of £100 from ATMs.
Parents can allocate up to £5000 to the card from within the Starling app and will have complete visibility and oversight of transactions, withdrawals and can even receive instant payment notifications when the card is used. If the child’s card is lost or stolen, funds can be locked from the adult’s mobile banking app.
A study from the London Institute of Banking and Finance in 2019 found that 82% of students want to receive more finance and money focused lessons at school. One of Starling Kite’s goals is to fill the gap in children’s education surrounding money and put a stop to the stigma of openly discussing it.
“Understanding the value of money and learning skills such as budgeting and saving from a young age, can help people lay the foundations for them to achieve better financial wellbeing later on in life,” said Anne Boden, CEO of Starling Bank. “We want Starling Kite to encourage families to talk about money together and not see it as a taboo subject.”
The child-friendly debit card has the owner’s name printed on it, providing a sense of responsibility and ownership and offers a variety of budgeting and money management tools, encouraging positive habits and financial awareness that may not be learned otherwise. A recent entry in Starling’s Money Explained series details how parents and guardians can help their children save up and build confidence in money skills - the article can be read .
Banner image credit: Starling Bank
Zafin: Banking is now in the era of the tech ecosystem
The development of tech ecosystems is placing the future of post-COVID banking in jeopardy. At a time when Big Tech can replicate the functions of traditional financial institutions, what can banks do to retain a grip on the market?
John Smith, EVP Ecosystem at Zafin, has a few ideas. A SaaS cloud-native product and pricing platform for financial institutions, Zafin is preparing the next generation of banks to cope with this precise challenge.
Smith is responsible for the strategic and tactical management of the company’s ecosystem, including the creation of new business models to support growth and differentiation. We asked him four questions:
Q. Have the events of the pandemic caused an irreversible shift in the digitalisation of banks? If so, is COVID the sole cause or are there other factors?
It’s a great question and one that I am asked a lot. Without a doubt, the COVID-19 pandemic has driven a significant shift in the acceleration of digital. In fact, I’ve seen some estimates show there to have been as much as four to six years of digital adoption growth since the initial lockdown started.
While the pandemic may be the primary reason for this growth, two other drivers include fintech disruption and the high costs of operating a traditional retail bank. Both of these factors have caught the attention of banking executives as they set their minds on accelerating digital transformation with a focus on high return, low risk.
Q. Some commentators believe banks must learn from Big Tech in order to survive. Do you agree? Please expand.
I agree completely; we’re living in the era of the ‘ecosystem’. All the seismic shifts we’re seeing in technology, be it aggregation, embedded finance, DeFi or hyper-personalisation are all enabled by the foundation of an ecosystem.
When financial institutions work with a strategic partner like Zafin, which has made the strategic investments in a best-in-class ecosystem, they’re able to capitalise on opportunities more quickly and safely, and will be better positioned for growth now and at the other side of the pandemic.
Q. What are currently the obstacles to adopting Open Banking? Is it more likely to 'take off' in some regions rather than others?
I would argue that Open Banking has been in the US for some time and will only continue to grow there. By definition, Open Banking is about the secure sharing of financial information that customers are aware of and have authorised. Under that definition, we’re seeing aspects of this well underway even though its full potential remains to be seen.
Third-Party Providers are a natural outcome of Open Banking, whereby they can create propositions beyond what a bank normally does to enable banking functions such as payments, borrowing, saving and so on. Once again, some of these are already present through industry-led initiatives, whereas regions such as the EU have taken the pathway of regulation such as PSD2.
The industry-led initiatives we’ve seen in the US have also had the added advantage of guard-rails that regulatory bodies like FFIEC and CFPB provide. There are also other technology-led initiatives such as API definitions that are set out through the FS-ISAC.
I would argue the future of Open Banking in North America will be through the natural evolution of the guidelines and API definitions that have been published, as well as the natural progression of industry initiatives.
Q. Are there any other bank tech trends you'd like to discuss?
Coreless banking. Zafin has been pioneering some of the work around externalising functions out of the legacy core to drive a more ‘fintech nimble’ bank, while not having to deliver a ‘heart and lungs’ core bank replacement.
Real life examples of this include moving some of the core functions of a banking system, such as product and pricing to a platform like Zafin. Origination, onboarding, KYC, risk, and compliance are all other examples of externalising banking functions for added agility.