The Customer Effect

Greenlight is making financial literacy a core part of its product roadmap

  • Greenlight Financial Technology now lets parents set savings interest between zero and 100 percent on their kids’ accounts to show them the value of savings and how it compounds over time
  • While its group of bank investors – SunTrust Bank, Ally Financial and nbkc bank – is notable, Greenlight is in talks with other potential retail partners and seeing “strong interest” from them
Greenlight is making financial literacy a core part of its product roadmap

Greenlight Financial Technology, the maker of parent-controlled spending cards for kids that recently received $16 million in funding from big banks like Ally and SunTrust, has added a savings option to its offering and is making financial education a key part of of its future plans.

Greenlight now lets parents set savings interest between zero and 100 percent on their kids’ accounts to show them the value of savings and how it compounds over time. Parents pay them the interest monthly and can also deposit directly into the savings. Its initial debit card product gave parents the ability to set controls on where their children spend.

SunTrust Bank, Ally Financial, nbkc bank and the Amazon Alexa Fund are among the partners that participated in the startup’s February funding round, highlighting the pivot from financial literacy tools as a nice-to-have to a need-to-have. As part of the Amazon partnership, the company is exploring the possibility of creating an Alexa skill, said CEO Tim Sheehan, to bring voice conversation about money management to the next generation.

It’s too early to tell how or if Greenlight, which has 100,000 users, could integrate with something like Ally Assist, the digital bank’s voice-command banking assistant. Sheehan’s first priority is to make the Greenlight brand a household name, but he also wants to make the products smarter. He declined to comment on any specifics on those plans.

“I’ve always been interested in what can be done that doesn’t require the user or customer to have to take a lot of actions to complete something,” he said, adding that AI presents a big opportunity to make personalized and easy experiences by pushing suggestions tailored to the individual user, the reasoning behind it and an easy way to respond.

“In the past the onus was on the user or customer to navigate the waters, figure everything out and then make good decisions,” he said.

That’s because in the past major financial institutions never really made educational products or those targeted at customers just beginning to build their financial wealth, and financial health, front and center of their brands or marketing campaigns.

BBVA Compass acquired Simple in 2016, JPMorgan Chase began offering Chase Liquid, a prepaid card designed for low-income customers with difficulty accessing good financial products, Wells Fargo is launching a sub-branded Greenhouse account with financial management capabilities built in. While they target the poor and financially unhealthy, they don’t always provide the educational tools to help them out of it. The biggest surprise in taking meetings with potential investors and partners was discovering banks’ intent is real, and “not just lip service,” Sheehan said.

“In fintech and financial services a lot of different organizations talk about [financial education] and maybe even put some things up on their website, but it wasn’t compelling,” he said. “It’s hasn’t been heavily marketed or integrated into the overall experience and that’s what’s changing now. There’s this alignment of goals between us and them.”

While its group of bank investors is notable, Sheehan also said the company is in talks with other potential retail partners and seeing “strong interest” from them.

“Thats what’s going to cause so much innovation and progress, many different players entering,” he said. “The banks will be a big part but large tech companies and retailers will see all kinds of interesting opportunities to raise the bar in terms of helping kids, and adults, understand personal finance and managing it well.”

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