Remember the very first paycheck you got? Most of us would immediately think of buying something nice as a gift for family and friends. Most young adults don’t understand the importance of money and management till much later into jobs. It was this thought that gave birth to Slonkit, a startup that aims to aid the younger generation in managing their money and understanding finances better.
Slonkit has developed and app and also issues a Visa powered debit card backed by DCB Bank. Parents and children have their own versions of the app. The children get a reloadable prepaid card, which they can use to make transactions at online and offline outlets.
The app allows parents to keep a track of the child’s expenses and help them budget. The child gets insights into how they are spending and learn the basics of money management by analysing their own expenses and learning to save. Slonkit can be used by children aged 10 and above. The app also allows parents to put a limit on the spending amounts, the number of transactions, and can even suspend usage.
Murad Nathani, Co-founder and CEO of Slonkit, saw the issue of smart money management during his growing up years. He never had to deal with financial worries or even have a direct interaction with the bank as a child. However, when he went to study in the US, and applied for a credit card, to his surprise, the application was rejected.
“The bank knew that I was a student and giving me a credit card was obviously a risk. It was a hard-hitting fact that I was not as financially literate. This is when I realised that money management or a general awareness of finance is a skill that should be taught at a much younger age,” says 41-year-old Murad.
As parents, the duo found that they shared similar pain points. Javed’s concern was about not knowing where his daughters were spending their money, and more importantly they didn’t know how and where they were spending it. Murad, on the other hand, felt a need for a tool that could help him teach his daughter to value and manage money better from an early age.
Prior to Slonkit, Murad had founded Eques Ventures in New York and had been a Principal at Bain & Company in Mumbai. Javed, on the other hand, was a founder at Clover Infotech.
However, the product being new and one of the first of its kind, the team found that parents are still reluctant to give financial freedom and independence to their children. To understand the target segment better, the team conducted a study where they interviewed the parents of children aged between 10 and 13 years. The study revealed that over 90 per cent of them gave money to their child on a need basis. They did not receive a fixed pocket money.
In case of parents of children aged between 13 and 17 years, barely 40 per cent received fixed pocket money. “We can’t expect our children to learn savings if they do not have control and sufficient money to understand the concept of saving through their practical experiences,” adds Murad.
While parents are aware of the needs of their children, the challenge comes when they do not know how to go about explaining the importance of money management on their own. Murad adds that it is here where tools like Slonkit play a significant role to help children understand the importance of managing money at a young age.
Slonkit is currently in the process of building their core team. The few members who have joined are from personal contacts and people that the duo have worked with previously. Launched in 2015, Slonkit has a total of 30,000 downloads in iOS and Android. On Google Play Store, the app has over 10,000 downloads and a rating of 3.2. The users are mostly from Tier I and II cities.
Slonkit wants to be known as the smart money management platform amongst the new generation. The team wants the product to grow with their customers. For example, they can offer a loan to an 18-year-old who has been a customer for five years. A user will have different money requirements at 10, 15, or 20 years, and Slonkit wants to grow along with them and facilitate these requirements.
“Smart money management entails payment, lending or borrowing and investment, these are the three important facets of money management, and that’s the vision for us down the road,” adds Murad.
Helping children with money management
Recently, Osper conducted a study where it was revealed that only 13 per cent of parents regularly discuss savings and finances with their children. Similar players include Osper, Oink, Bankroo, and GoHenry. Apart from such apps, even traditional banks like Kotak, SBI, and HDFC today are looking at helping children become better with money management with special savings bank accounts and other facilities.