Despite Digital Evolution, Tech-Savvy Teens Remain Stuck With Cash

Despite Digital Evolution, Tech-Savvy Teens Remain Stuck With Cash
Despite Digital Evolution, Tech-Savvy Teens Remain Stuck With Cash

Eighty four per cent of Indian teenagers prefer to shop online - a trend that has only accelerated during the last six months owing to the pandemic - reveals a survey by FamPay, a Neo Bank for teenagers. It was conducted in August 2020 with 1200 teenage respondents across the country.

Ironically, digital savvy teens are still stuck paying with cash as they are not a part of the online financial ecosystem, says the study. Despite the Digital India initiative, 67 per cent of teens continue to pay in cash and 52 per cent pay through their parent’s debit/credit card, thereby continuing to be outside the digital financial ecosystem. In recent instances, a teen inadvertently made a transaction of Rs 6,000 on his parent’s app while in another instance, a teenager having access to his parent’s bank accounts used it to upgrade his online game account spending Rs 16 lakh. The teenager reportedly made in-app purchases for his teammates as well, which the parent realised only after the transaction was completed.

“Digital payments have become the ‘new normal’ for 300 million adults,  but not for 250 million teenagers, making them dependent on cash or their parents’ cards for the last mile of completing a transaction. Today’s teens are tech-savvy and it is only logical that they are involved users in the digital payment ecosystem”, said Sambhav Jain, Co-Founder, FamPay.

Indian teens spend more on food, clothes, and gadgets. They also have strong preferences for brands like Apple, Nike, H&M and Netflix.

According to the survey, teens get money on demand from their parents. Nearly 50 per cent of all teens confirm they get money when they ask for it. Only 23 per cent receive pocket money and 25 per cent say they typically receive money on their birthdays or from visiting relatives during festivals. Surprisingly, only 4 per cent teens receive money for chores.

“We are extremely keen on taking a customer-first approach in everything that we do. This survey was focused to understand our consumers deeply and build a product that begins and defines their journey to be financially independent,” added Jain.

When it comes to social media, due to its easy accessibility, today’s teens are more socially aware, and are not shy of voicing their opinion. The survey points that 80 per cent of teens spend time on Instagram, followed by YouTube and WhatsApp. Starting from watching and producing content to consuming news and being in touch with friends, the platforms are highly utilised.

If we dive into the content, then 55 per cent are passionate about “Made in India”, 40 per cent support women empowerment agenda, 28 per cent support Black Lives Matter and 19 per cent support the LGBTQ cause.

Teens cite mutual respect and trust as being important aspects of their relationship with parents. Nearly 36 per cent say that they would like their decisions to be respected more, while 34 per cent say they would like their parents not to stress so much about their studies. Interestingly, more girls would like their parents to trust their decisions, while more boys prefer their parents not to stress about their studies and 20 per cent teenagers say they would like their parents to spend more time with them.
The lockdown has disrupted routines for teens, just like every other person. 20 per cent teens miss dining out, 11 per cent say they miss attending classes in school, while an overwhelming 50 per cent cite missing their friends the most during this time.

"From our interaction with teens, we know that parents don’t talk about money as much as they do about education. The teenage years are foundation building years, where one can acquire money skills and even afford to make mistakes while learning since the stakes are lower. It is crucial to form good habits during these years from financial skills to decision making," said Kush Taneja, Co-Founder, FamPay.

“The recently announced National Strategy for Financial Education (NSFE) by RBI for the next five years (2020-2025) to disseminate financial education in the country is a welcome step in the same direction,”  he added.

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