The pocket money cash card for 8-year-olds loaded with hidden fees



Parents are being wooed to take out debit cards with sky-high charges to give to children as young as eight.



Hooked: Parents' concern over launch of new cash card for children

Card company Visa and payment service PKTMNY have launched a card for youngsters which they claim will help teach them how to manage their money.

But experts have warned that the card is loaded with hidden charges, and using it could lead to children getting hooked on credit cards when they are older.

Justin Modray, founder of advice website Candid Money, says: ‘Cash is becoming more scarce, but do eight-year-olds really need to be getting used to spending by card?



‘There is a raft of charges, which means that this card is probably just not worthwhile for parents who give modest amounts of pocket money.



‘What is more, many parents might not want their children to get used to spending on plastic in case they migrate to credit cards when they are older.



‘And while cards will allow children to shop online, most parents want to keep a tight rein on what their kids are up to on the internet.’



The PKTMNY card works like a pre-paid card. A parent or adult sets up an account online for themselves and another for their child, into which they deposit money.

The child, who has to be between eight and 16, is then sent a debit card linked to their account, which they can use online and on the High Street.

It is not possible for children to get into debt as they can only spend what they have. Children will be automatically barred from products which are age restricted.

And parents can set a further ban on where the card can be used, so that, for example, it will be turned down at cash machines.



Adults can also limit how much their child spends.

However, it also has costly charges. Families pay a one-off £5 fee to set up an account. There is a further £1 a month fee for each card. This is deducted automatically from the parent’s account.

Meanwhile, if parents top up their account using a credit card, they will have to pay a 1.21 per cent fee. For a debit card, it is 50p.



Payments made direct from their bank by standing order are free.

There is also an additional 50p fee deducted from the child’s card each time they use a cash machine, and £2 if they withdraw cash abroad.