Greenlight Financial Technology, the company behind a banking app for kids and parents, has received investments from banks such as Wells Fargo and
On Wednesday the company announced Greenlight for Banks, a capability that lets banks and credit unions integrate
The Seattle-based Washington Federal, or WaFd Bank, is one of Greenlight for Banks' early partners.
"We've had a '
Cooper hopes to improve client satisfaction, attract new customers and boost customers' overall financial health in a measurable way.
Efforts to recruit millennials and Generation Z include letting cardholders select preferred names and pronouns, offering rewards for gas purchases and providing financial guidance.
There are several aspects that may make Greenlight for Banks attractive to both banks and their end users. Partners can tweak the messaging in their co-branded Greenlight app and cross-sell products, such as other checking accounts or credit cards. Although the direct-to-consumer Greenlight app carries subscription fees of $5 to $15 per month depending on the
"Banks want to create multi-relationship customers," said Matt Wolf, senior vice president of business development at Greenlight, in an interview.
Wolf acknowledges that 12-year-olds will not rack up large balances, and says that Greenlight does not encourage high spending among its young users.
"But traditionally, parents are taking money out of the bank and giving it to their kids in cash," he said. "We've arranged it so the bank can keep deposits and grow that base."
End customers will access a plan called Greenlight Select, which is a version of the company's direct-to-consumer base-level Greenlight Core tier, albeit without a credit card or investment capabilities. Users will get a debit card and app features that include parental controls (for instance, the ability to set limits by spending category or store), the ability to set up chores and automated allowances, and gamified financial literacy. Wolf describes the arrangement as parents owning the account while their children get access to a subledger.
JPMorgan Chase was Greenlight's first bank customer in 2020, well before Greenlight for Banks existed. Through the solution that Greenlight designed for Chase, "We learned that a lot of banks and credit unions would like to do this but it's not realistic that they would make that level of investment," said Wolf.
So far, six financial institutions use Greenlight for Banks, including WaFd; Morgan Stanley; High Country Bank in Salida, Colorado; and Community Financial Credit Union in Plymouth, Michigan.
Cooper of WaFd said the bank has a long history of promoting good financial habits for this demographic, including partnering with content platform Banzai and youth organization Junior Achievement to bring financial education content to schools in its eight states and a savings account program at elementary schools.
"It worked great until COVID interrupted school attendance and it became clear that we needed to bring technology solutions to these kids and their parents," she said.
