Ecosystem

{Startup watch: YPay} Financial inclusion for Indian teens via smart card while parents keep an eye

This young fintech startup is an AI based digital payments platform that helps teens to manage their spending, while parents track their financial activity.

Today’s teens are riding the technology wave to the fullest height. While in any age, teens are usually savvier than their parents, the kind of exposure the current generation enjoys because of the Internet becomes unprecedented every day.

However, when it comes to the financial world, Indian teens are yet to become a part of the digital financial ecosystem. The pandemic has revealed the need for this population to be educated in money matters as well, which still depends a lot on cash.

A recent survey conducted by FamPay to understand the spending patterns of 1200 Indian teenagers found that while 84% prefer shopping online, 67% continue to pay in cash and 52% pay with their parents’ debit or credit card.

Not only do cash transactions question financial inclusion of Indian adolescents, some of them also misuse cash, sometimes investing in things they don’t understand yet, leading to the need to track their financial activity.

“A lot of kids still transact in cash that their parents hand them. This leads to misuse of money, mismanagement, inability to track, and security challenges,” Dr. Navneet Gupta, founder and CEO of YPay, a digital payments platform helping teens manage money, says.

Dr. Navneet Gupta

Parents often do not have any idea about how their kids are spending pocket money, and they worry. We are trying to provide a solution to address both ends

The Tech Panda spoke to Dr. Gupta about how they are doing this.

“Parents often do not have any idea about how their kids are spending pocket money, and they worry. We are trying to provide a solution to address both ends,” he adds.

YPay’s smart card provides children the ability to transact digitally, while parents can keep a check on the expenditure through the YPay app.

“Thus, children learn money management securely, and parents can monitor and guide them,” he adds.

What it Does

The young fintech startup is assisting kids and young teenagers become financially literate and learn to balance their spending. YPay is helping teens manage their spending through their YPay smart card.

“Using the card is very simple. It works like any other smart card or debit card. One can spend it at grocery stores, school fees, etc.,” Dr. Gupta explains.

Our card is specifically designed for teenagers, acting as a pocket money card for them

Parents with registered and approved KYC can easily top up the card, set spending limits, and monitor the card usage on the app itself.

“Parents can complete the KYC on the YPay app and create their accounts. Once done, they can simply start topping up the card and transacting through it. Our card is specifically designed for teenagers, acting as a pocket money card for them,” he adds.

Also, the withdrawal of money from ATMs is possible without having a bank account.

“Being numberless, it secures the consumer’s data. Also, one app can help to control and see the transactions of two of children with two separate cards, making it convenient for parents to see what their child is up to,” he further explains.

Origin & Inspiration

YPay was founded in 2017 and is based out of Bareilly. Dr. Gupta was standing at a grocery store when he saw a kid holding out cash for a transaction. He recalls that that was when the idea came to him.

It struck me that even kids can switch to card-based payments, provided there is enough security in terms of limits, monitoring, card details

He wondered why the kid did not have a card but cash. That is when he further discussed the idea with his friends and decided to launch a product that will be able to facilitate payments for children too.

“It struck me that even kids can switch to card-based payments, provided there is enough security in terms of limits, monitoring, card details, etc. In line with the same idea, we created a YPay card for which parents can control the expenditure, transactions, transparency, etc. And above all, it is a numberless card,” he says.

Growth Story

The YPay android application has already seen more than 50k downloads on Google Playstore and registered US$1.5 million worth of transactions pan India. The brand has tied up with RuPay, and Yes Bank to facilitate cards.

What’s different about the digital payment platform, says Dr. Gupta, is the positioning of their brand.

Other brands are targeting the youth in urban towns, but we are targeting smaller towns helping each and every one to access digital means of money

“Other brands are targeting the youth in urban towns, but we are targeting smaller towns helping each and every one to access digital means of money. YPay is the first of the digital payment solutions for the youth of Bharat, which is aiming to reach as many people as possible,” he says proudly.

The startup aims to have over 100k users within the next two months. It already has 300+ brand partners on board and expects to take this number up to 500 by the end of fiscal 21.

“For the future, we are aiming to have one million users by the end of this year. We are also aiming for US$15 million worth of transactions with 20% growth in month-over-month,” he says.

Navanwita Bora Sachdev

Navanwita is the editor of The Tech Panda who also frequently publishes stories in news outlets such as The Indian Express, Entrepreneur India, and The Business Standard