OCBC to allow 7-year-old kids to have own bank account, sparks concerns about reckless spending

7-year-old kids can soon have their own OCBC bank accounts

Starting from 20 Oct, OCBC will allow kids as young as seven years old to open their own bank accounts with the OCBC MyOwn Account.

This account will be registered solely in the child’s name, unlike the joint accounts offered by most other banks, which require parents to be co-account holders.

Currently, most banks in Singapore require individuals to be at least 16 years old to open a bank account.

OCBC has described this initiative as a “natural choice” for Generation Alpha, children born after 2009 who have grown up with digital technology.

Parental oversight maintained

While the OCBC MyOwn Account will be registered solely in the child’s name, parents will still be able to monitor their child’s spending.

Parents must open the account via their own OCBC Digital app.

A separate dashboard will be created on their app, allowing them to view their child’s funds transfers, payments, ATM deposits or withdrawals, and debit card usage.

These sensitive functions will also remain exclusive to the parents’ OCBC Digital app:

• Setting transaction limits
• Updating contact details
• Receiving spending notifications
• Resetting the debit card and PIN
• Reporting a lost debit card

Intended to foster early financial education

OCBC views this initiative as a way to educate the younger generation about finances.

The bank acknowledges that while parents often restrict children’s screen time, they may not have personal smart devices initially.

Therefore, the OCBC MyOwn Account is designed more to teach financial literacy rather than to facilitate payment habits.

Parents can use their OCBC Digital app dashboard to show their children changes to their account balance.

For teenagers with their own devices, having an account allows them to make digital payments independently, which OCBC considers important as more merchants adopt cashless transactions.

With the bank’s digital app, these teenagers can also monitor their expenses closely.

Additionally, children can choose from various account designs, increasing their sense of ownership.

OCBC conducted 18 months of research into the behaviours, psychology, and aspirations of parents and children before launching this initiative.

Netizens much less optimistic

While OCBC has announced this initiative with much enthusiasm, netizens are more cautious about the development.

Concerns have been raised that children might spend money recklessly due to the convenience of digital banking.

Others worry that children could become targets for scams, which have been increasingly prevalent in Singapore.

Aware of these issues, OCBC has stated that it will introduce a special financial literacy programme tailored for Generation Alpha alongside the OCBC MyOwn Account.

This programme will include components focused on online safety and protection from scams.

Also read: The OCBC scam took my life savings, this is how I made my peace with it

The OCBC scam took my life savings, this is how I made my peace with it

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Featured image courtesy of OCBC.