Current, a startup operating in the financial cards space has just announced the raising of their Series A financing round totaling a sum of five million USD. The company’s flagship product is a debit card aimed at kids. The parents have control over the card via an app on their smartphones. The company had first released the card powered by VISA in the month of May this year.
The card is linked to a bank account on the backend into which parents can transfer small amounts digitally for their kids to then utilize. The card can be used for both the online as well as offline shopping mediums.
This new round of fresh financing was led by QED Investors. The round also saw participation from venture capital firm Cota Capital. Frank Rotman, founding partner at QED Investors is set to join the board of Current as part of the deals proceedings.
The venture was incubated at the Expa Studio. It had previously raised a sum total of 3.6 million USD in seed funding from the likes of Expa and venture capital firm Human Ventures in the month of March this year.
Current was started with the aim of helping shift the teens as well as tweens into the digital economy from their current cash only scenario. This is in keeping pace with the changing tides in the United States of America; a push towards the digital economy.
The VISA powered debit card’s backend account is refilled by the parents of the kid using the card. The parent can transfer money from his/her own account present in any of the banking institutions to that of the account of the kid on Current.
The feature demarcating Current from the previously launched debit cards aimed primarily at the younger folk such as VISA Buxx is the availability of an supporting mobile app. The parent can even set a chores list on the app, post completion of which the pre-decided amount would get auto transferred to the kid’s account.
Parents also hold the reins to control the kids spending by setting withdrawal and swiping limits on their kid’s card through the mobile app. The parent can set daily transaction and withdrawal limits based on purchases and ATM’s. They can also block the card the card from being accepted in certain business areas such as a casino or even for flight tickets.
All of these constraints still give the kid a sense of autonomy which helps the kid gain some form of freedom from his/her parents financially too.
“More and more consumers and retailers are eschewing cash for digital payments, yet the market seems to want teenagers to start-off with a traditional checking account,” said Current Founder and CEO Stuart Sopp, in a statement released alongside today’s funding news.
Focusing just on the teenagers was an extremely strategic decision for Current, they are an untouched audience who are extremely interested in transacting in a complete different manner as compared to the previous generations.
The current US demography reads thirty million teens with almost five million aging into this category every year. Their ATM transactions account for only 4% of their monthly expenses(transactions). That makes a fairly compelling argument for a kid-and-parent friendly debit card.
Current has, however, decided to keep mum regarding the numbers on its subscribers list citing competitive reasons.