As a result of our recent posting “Recommended Payment Methods for Safer Online Shopping Experiences: A Parent’s Guide To Reducing The Risks (1), we have had several parents and caregivers reach out to us asking about our thoughts surrounding allowing a youth to have a cash app or a pre-paid card.
As a parent or caregiver, understanding the pros and cons of cash apps and prepaid cards for your kids is extremely important. While these financial tools offer convenience for everyday expenses like lunch money, transportation (bus), gas, or small purchases, they also present potential risks that need careful consideration. We have written this article to help you, the parent or caregiver, navigate these options to assist you in making an informed decision when it comes to cash apps and prepaid cards.
As mentioned above, it is important to know that some youth and teens might need cash apps or prepaid cards for various reasons, such as the convenience of handling daily expenses or as a practical way to teach financial responsibility. They might need them for small jobs that they offer, like cutting lawns, where their customer can pay them electronically. These tools can offer a sense of independence and help youth and teens manage their finances under parental supervision.
However, there are less desirable uses that parents should be aware of as well. Some youth and teens might use these apps for activities like purchasing and selling vapes (2), purchasing explicit content (3), purchasing and selling drugs (4), in-game purchases, online gambling (5), and for services rendered if the teen is involved in the sex trade for things like “sugaring” (6). In some cases, we have heard anecdotally from youth that older teens and other adults (pimps and drug dealers) outside the family will act as intermediaries or “money broker” for a fee, so that younger teens can access and download these apps without their actual parent’s consent, adding another layer of risk.
Note – there are now monetization platforms, such as unlockt.me, that also allows a user to download an app directly onto their phone to monetize any picture or video they wish to send to another person. Although you have to be 18+ to use this app, this age gate is easy to bypass. Unlockt.me also states in their Terms Of Service that the selling of “sexual or pornographic content” is prohibited. However, in doing a quick search of Instagram and TikTok we found several accounts selling foot photos (“piggy pics,” grippers, “footography”), nudes, and other intimate images, with links to unlockt.me attached, usually in their bio.
Although there are several cash apps on the market, anecdotally we have found that “CashApp” and “Venmo” are presently the two most popular with youth and teens.
#1 – CashApp:
One of the most widely used options, CashApp is available for children as young as 13, with parental approval required. (7) However, there is no way to ensure and verify that the person providing “parental approval” is actually the parent – this is a significant concern. The parent must own and manage the account, but the app’s monitoring capabilities are somewhat limited. CashApp also offers a physical Cash Card that kids can use for purchases.
#2 – Venmo Teen Account:
Venmo recently launched a Teen Account, available for teens aged 13 to 17. (8) Parents must set up the account on behalf of their teens. Again, and much like CashApp, there is no way to ensure or verify that the person providing “parental approval” is actually the parent – this is a significant concern. Venmo offers no monthly fees or cash withdrawal fees, with some limitations on use. Parents can also choose to set transactions to “private,” enhancing privacy protection.
Before allowing your child to use a cash app or prepaid card, it’s essential to thoroughly research and understand the terms and conditions of each option. Set clear boundaries and guidelines for your child’s usage, and, when possible, monitor account activity regularly. This vigilance can help you spot any concerning patterns or unauthorized transactions early on.
Regardless of which financial tool you choose for your child, maintaining open and ongoing conversations about responsible financial habits is key. Discuss potential risks, such as online scams, peer pressure to misuse funds, and the importance of budgeting. Let them know that once they send money using these specific apps, there is no getting it back even if they were scammed to send it. By staying informed and proactive, you can help your kids navigate these financial tools safely and responsibly, laying the foundation for sound financial habits in the future.
However, a word of caution – if your child has a cash app on their device but doesn’t have a job, and you, as the parent or caregiver, aren’t the one funding it, it’s important to dig deeper. Talk to your child and ask why they have the app installed and where they’re getting the money to use it – two extremely important questions that might provide some insight into what is happening in your child’s life that you may not be aware of!
Digital Food For Thought
The White Hatter
Facts Not Fear, Facts Not Feelings, Enlighten Not Frighten, Know Tech Not No Tech
References:
2/ https://thewhitehatter.ca/vaping/
3/ https://thewhitehatter.ca/online-pornography-and-hypersexualization/
4/ https://thewhitehatter.ca/blog/how-some-teens-are-using-technology-to-purchase-or-sell-drugs-online/
5/ https://thewhitehatter.ca/blog/yes-some-youth-are-gambling-in-the-onlife-world/
6/ https://thewhitehatter.ca/intimate-images-nudes-sexting-deepfakes-and-sugaring/
