Cash App has launched managed accounts for children aged 6-12, providing a 3.25% interest rate on savings. The move by Block's fintech platform aims to introduce youth banking services. Notably, these accounts for younger children do not include access to Bitcoin, though it remains an option for sponsored accounts designated for teenagers.
Parents will retain full oversight of these new accounts, with the ability to approve transfers from up to five trusted contacts. Upon reaching age 13, these managed accounts can transition to sponsored teen accounts with parental permission. The service is not available in New York.
While younger users are restricted from cryptocurrency, sponsored accounts for teenagers may offer Bitcoin trading if parents grant approval. A Block spokesperson confirmed this distinction for the younger children's accounts.
This initiative coincides with evolving savings behaviors among young people. A survey indicated that 89% of Gen Alpha children are actively saving money, with digital and gaming purchases being primary savings goals.
"We built managed accounts to give kids access to real financial tools and experiences while keeping parents fully involved,” stated Owen Jennings, Block Executive Officer and Head of Business. Cash App, a subsidiary of Block Inc., has broadened its offerings beyond peer-to-peer payments to include banking and investment services.