- PayPal’s Venmo said Monday it will provide a peer-to-peer account tailored to teens starting next month, letting parents and legal guardians open the accounts for teenagers who are 13 to 17 years old, according to a press release.
- The Venmo account, which will include a debit card, will let users manage their funds while parents and guardians are able to view the transactions, manage the privacy settings and send money to the teens.
- The new service will only be available for a select group of users in June, and more “widely available in the coming weeks,” the company said.
The teen accounts’ privacy settings will automatically be set to “private,” with parents or guardians able to view the teens’ friends list, in addition to their payments. Only the parents and guardians will be able to alter the privacy controls, per the press release.
The account will also offer teens customizable card designs and allow them to receive direct deposits from their after-school jobs or other sources.
PayPal Senior Vice President Doug Bland mentioned late last year at a conference that the company was testing a teen account. He also noted that roughly 25 million teenagers aged 13 to 17 already use the regular app, and a third of their parents use it.
Given that Venmo users tend to have higher incomes and skew younger, PayPal aims to focus more on the app as a pathway toward growing its user base. Now, the company is accepting new applicants for the service.
Venmo’s new teen product lets parents and guardians manage their teen’s debit card, including changing their PIN, locking and unlocking their debit card and blocking users from interacting with an account, per the press release.
The card also comes with a $400 daily withdrawal limit and charges $2.50 ATM domestic withdrawal fees at ATMs not in the MoneyPass network, according to the press release.
Venmo pitched the service to parents as a way to teach their kids about money management. “Venmo is a natural place for teens to learn how to engage with money responsibly, especially considering 86% of Gen Z are interested in using an app to learn about personal finance,” Venmo Vice President Erika Sanchez said in the statement.
PayPal has sought to introduce more services that will increase the company’s profit margins as the growth of its branded checkout service slows. Recently, it’s been relying more heavily on its unbranded services, such as those offered by its Braintree unit, to support growth, but those services have lower margins.