Cashee wants to teach Gen Z how to manage finances with its digital banking app
Built on the fundamentals of managing money, like earning, spending and saving, Cashee is a Middle-Eastern digital banking and applications platform for users between the ages of 13 and 21.
Sindhu Kashyaap
Monday October 31, 2022 , 6 min Read
Being brought up in India and the Middle East, Smeetha Ghosh-Jorgensen’s life saw a greater emphasis on academics than life-related skills like financial literacy. The idea to make a business out of imparting these skills came much later, through a news article.
“Brad sent me an article of what a bank in New Zealand was doing around the area of financial literacy for kids in New Zealand and the minute I read that article, I knew it was a space I needed to look into,” says Smeetha. Soon Smeetha, along with Brad Whittfield and Gups Jutla got to work. They ended up setting up Cashee—a digital banking platform for users between the ages of 13 and 21.
The three founders wanted to set up a company that shared the model of companies elsewhere but with a Middle Eastern flair. Having understood the spending patterns and nuances of people in this region and with decades worth of experience in finance, they were able to arrive at a model that fit the needs of these consumers nearly two years ago.
Cashee operates as a co-brand product for a bank. This means, that it does not directly interact with the central bank but works in association with a partner bank as its tech partner. “The financial regulatory piece is segregated to the risk at the bank’s level but the technology sits with us,” says Gups.
Getting on the app is simple. Once the app is downloaded via iOS App Store or Google Play Store, users must fill in their details as prompted by the app. After this, they are required to send the registration link to their parents who also get onboarded to Cashee. Once this is done, both sets of users—the users and their parents—get access.
Once onboarding is complete, users will receive their cards via mail within three days. This concept fetched Cashee a total of $1 million in funding in a pre-seed round in June last year.
Founders of Cashee
Imparting financial literacy through an app
Features on Cashee are based on three crucial fundamentals of personal finance— earning, spending and saving.
Earning is imparted to users in the form of allowance received from parents, which can be unlocked by completing simple chores. This can be logged on the app at the beginning of the task and the earnings will be credited upon completion. Through the logs, users can also check their earnings every week.
As for savings, Cashee equips its users with a savings goal feature where they can set personal goals. Users can also separate these goals and begin allocating money towards them based on their interests. According to Smeetha, this is to bring about the concept of delayed gratification—the idea of resisting impulse in exchange for a greater reward in the future.
Then comes spending. If payments are made through the Cashee card, the app can automatically categorise these expenses. It also produces a graph which shows frequency of purchase and the value of each purchase. This graph is later used to give advice to the user based on their activity.
Smeetha explains, “The app may ask the user to spend a little less on a particular expense reminding them of their good performance in terms of spending versus earning for that month.”
This advice is determined by the app using data about a users’ purchasing speed and preferences; it also keeps a tab on their spending habits.
For 14-year-old Amenah Almuhari, Cashee does away with a need to carry cash. “It's helpful when I travel as I can just ask my mom to send me money any time instantly and then I am good to go,” she says.
Building a fintech startup in UAE
It can be difficult to set up a fintech company in the UAE. According to Gups, this is because of heavy regulations and a conservative market in this region, unlike other markets like India. In part, this could be due to people’s tendency to avoid risk when it comes to money, he says.
One of the key challenges for Cashee was finding a bank. “The entire process is laborious,” says Gups. According to him, getting a bank approval and acceptance from the regulator can take anywhere between 6 months and 2 years.
This is unlike India where licence providers can give founders RBI-endorsed fintech facilities, he says. In essence, the bank needs to buy what you’re selling both in terms of a model and pitch. “Funding does not take place until a bank has been secured because without a bank you remain a concept,” he says. In Cashee’s case, it did not secure funding until it onboarded a bank.
Fintech adoption in the Middle East
Fintech adoption is growing in this region. According to CB Insights, new funding in the segment was at $2.1 billion across 175 deals. Till May this year, there were 41 deals in this space, amounting to $503 million.
Another report by UK-based Finextra suggests that the region currently has a vast variety of fintechs, with UAE as the emerging leader with nearly 24% fintechs in the Gulf Cooperation Council (GCC) region. Within the UAE, Finllect, Ziina and Zywa are among the biggest fintech players, with Zywa being Cashee’s direct competition.
Several analysts have taken note of the fact that banks of UAE, Bahrain, Egypt, and Jordan, among others, have begun using special initiatives to regulate and encourage digital payments.
What’s next for Cashee?
The founders are currently close to launch and are awaiting regulatory approval. While it currently operates on a freemium business model, there are plans to launch a premium product in the near future.
“In the premium mode, we will offer more value-added products and features and we hope to attain subscription revenue for the same,” Smeetha says.
A gamified educational platform is in the works. “We will then have the fintech part of the app, which is the practical application, and also there will also be the theoretical knowledge that you gain through the gamified environment,” she says.
Edited by Akanksha Sarma