Kards 4 Kids: A Product Design Study
Designing a credit card marketed towards children, creating a helpful and financial stable system for families.
Sadly, when I was forced to ask myself what a credit card was, my answer was rather shallow: You get a card, charge it, then pay off the card. You get good credit when you pay off all your charges on a timely basis (showing how responsible you are), and you fall into heavy, heavy debt and bad credit if you don’t pay off your charges on a timely basis (hello APR my old friend).
So I knew, as one of my big steps when creating this product, I needed to better understand this financial giant. But there were certainly other steps I needed to take, as a designer, to have a final product to present, and possibly bring to market. So, first things first, I needed a game plan.
I’m one of those people that always needs a strategy. If I’m going to have a layover in Dallas for just one night, I need to know the best restaurants in close proximity to my hotel so I don’t wander around for an hour, when I could be eating delicious BBQ. So knowing my deadline, I needed a day by day schedule of what I wanted to accomplish, so that I would end up with a final, detailed presentation and product.
With some input from fellow designers that I chatted with, I decided on this step by step process.
- Define the Problem
Why does the market need a credit card for kids? Is there somewhere that the current financial planning in families is failing? What is the job of my product? If there is no need for my product, then my product will fail on the market. I need to make sure that a credit card for kids will be needed, and how so, in order to meet the consumer needs.
2. Market Research
That goes back to my original dilemma. I need to know what exactly a credit card is, and how it works. It’s the only way I can build one from the ground up.
3. User Research
I needed to find out what a families financial system normally works, and probably most importantly, what would parents feel comfortable with. Teaching your children about finances is an important part of parenting, and is very much a part of the family structure. It’s important to point out that each culture handles family finances differently, and I narrowed my research on American families.
4. Competitive Analysis
Does something like this already exists on the market? If so, how can I design mine to be better/work differently from competitors? If there are no competitors in the space, why? All questions that needed answers.
5. Design & Development
Then it’s time to take all the information that I have gathered and start designing the product. Not the visual design, but the layout, information architecture, amount of products within the product (an app, for instance), etc.
While my wireframes may not be the prettiest in town, I do need to create something to bring my product to life, and most importantly, conduct testing on.
7. Testing & Feedback
For obvious reasons. I need to conduct testing and iterations until I’m confident that the product can meet user needs and ease their use of the product (for as long as I am able, of course).
8. Final Prototype
For those still with me, congratulations! Now let’s go a little deeper.
Define the Problem
Why should I design a credit card for kids? I needed to look at the financial relationship between children and their parents and why kids have or do not have credit cards.
After some research and user interviews, I determined 4 common reasons why a child is given a credit card:
- In the case of a financial emergency
- Parents want to track their kids spending habits (which can’t be done with cash)
- Help their kids build a credit history
- Purchases that would require a card, such as online shopping
Now, why are parents hesitant to give their child a credit card:
- A high spending budget can cause a child to spend more than they are financial able to
- Fear of debt
As shown, there are a lot of pros and cons for giving your child a credit card. To address both, I created a solution.
Create a credit card for children that allows them flexibility, but gives parents monitoring capabilities and financial assurances.
I narrowed my market research into 2 sections: how credit cards work and parent & child money management.
How Credit Cards Work
I’ve had a credit card myself for years, but I needed to look at this with new eyes, as if I had no idea what a credit card and how the process works.
Once I better understand the practice of owning and using a credit card, I can see where a child’s credit card can fit into the equation.
Annndddd, this is some good insight for readers in case you need to learn some things about credit cards too (like a Stuff You Should Know written episode).
A credit card is like a short term loan. Using them responsibly will help you build good credit. This credit history will help later on when applying for loans, apartments, etc.
Common terms to be aware of are credit limits, billing cycles, minimum payments, and APR, which is essentially an interest rate.
Cards do have other fees, including annual fees, late fees, cash advance, etc. (something to consider in creating the final product).
There are also different types of credit cards: rewards credit cards, secured credit cards, and charge cards. While having a reward credit card seems unnecessary, making the card secured is something to consider.
Possibly one of the most sensitive topics to cover is the application process. To apply for a credit card, personal information is needed, including income, social security number, credit score, etc.
An authorized user of a credit card is someone who has a credit card with their name, but is not the primary account holder. An authorized user can’t make changes to an account, and is not legally responsible for paying the credit card.
In the United States, you are not allowed to apply for a credit card until you are 18. In order to have a credit card, you must be an authorized user under an adult’s account. Other options are debit and prepaid cards.
In case you don’t feel like reading through all of that, here are some key takeaways that are important in the creation of the product: Minors aren’t allowed to have credit cards. They can be authorized users on their parents card, and still gather credit to help with loans in the future.
Next I looked about parent and child money management, and what the cultural norms already are.
For most of my research, I relied on a study done by T. Rowe Price. It gave some really great insight on how parents handle finances with their children, and vice versa.
A lot of the findings I thought were expected, such as the age when parents started financial discussions and responsibilities. One thing that I found very surprising was the amount of children that pay their own credit card bill. Therefore, I wanted to include an option for children to pay their bill directly on my final product, rather than through a parent.
I also conducted some user interviews, with both parents and children. Before just diving in and talking to some parents and kids, I needed to set some guidelines.
Who: Parents with kids ages 6–18, and kids ages 6–18
*Why 6? Studies show that at 6, children begin to notice typical money habits and feel the pull of advertising and peer pressure to spend* T. Rowe Price
How: This depends on where the product will be releasing. I wanted to talk to the people who may be inclined to try this product later on. So looking digitally for users may make it hard to target their location. Instead, I connected with local institutions, schools, sport leagues, music lessons, etc, places where parents and their kids were involved together.
Format: I had a list of questions I wanted to ask, but the format of the interview is dependent on the interviewee. I follow their lead in the discussion, finding out as much as I can about their needs and concerns when it comes to handling their child’s finances.
My questions are a mix of what is already in place, what belief system has been instilled, and what do they imagine possibly happening in the future.
What kind of finance system do you have set up with your kid(s)?
Do you ever limit where they can purchase items, such as specific stores?
Are you concerned about your child’s credit score? Why or why not?
Do your kids ever go over budget? If so, what do you do?
How do your parents give you money?
Do you think about saving your money?
What do you do if you want to buy something expensive?
I took a look at some of the most prominent companies out there offering credit card options for kids. From my research, I can not find a credit card specifically targeted for kids in the United States. There are lots of options for debit and prepaid cards targeted towards kids, and major credit card companies do have options to add a child as an authorized user. Otherwise, there is a big gap in the market when it comes to a specific card meant for kids.
Regardless, I decided to take a look at the features offered by some of the competition in the debit and prepaid space.
There were a few things that I saw the competition doing that I would like to bring into my design
- Parental notifications: Customizable to how often, price, etc.
- Ability to lock or unlock a card at a moments notice
- A monthly subscription fee
- A mobile app to track spending
- Location approval by parents (especially important for a credit card)
- Customizable physical card
- Compatible with Apple Pay
- No age restriction
- Charge requests
- Child able to pay directly
Design & Development
The big factor moving forward is to justify a credit card to parents, vs. a debit card. Why risk yourself to a high bill that you may not be able to pay when a debit card is a better safeguard?
If you look back at “Defining the Problem”, there are 4 reasons why a parent would give their child a credit card. 2 of those reasons can be solved by a debit card, but 2 of them can only be done with a credit card: building a child’s credit score and financial emergencies. Those are the two attributes that must be highlighted.
The card, account and app will be an add on feature for parents that already have an existing credit card. For the sake of the assignment, I named this card KidCard.
KidCard makes the child an authorized user on the parent’s credit card account. The card comes with individualized apps for both the parent and the child.
The card itself will have the child’s name. When signing up, the child has the option to customize the card with a photo, design, etc. The design must be approved by the parent, however.
The card will have a chip for additional security, as well as a security pin (in case cash withdrawals are needed).
Parent App Design & Features
Since the card will be as an authorized user to an already existing card owned by the parent, it will be managed on the parent’s credit card app. Similar to being able to switch accounts on Instagram, the parent will be able to switch from American Express Account (for example) to KidsCard Parent Account.
On the app, the parent will set a spending limit with a set schedule (for example, $200 in a month). Other features include locking/unlocking the card, setting locations for where the child may spend, managing multiple cards for multiple kids.
Another feature will be credit checks. Since one of the unique factors that would entice a parent to set up their child on a credit card rather than debit card is for credit history, the parent can check their child’s credit score in real time.
Child App Design & Features
The child will have 3 features available on their app: Spend, Save & Give.
In Spend, the child can see where they have spent their money, and how much they have left on their limit. If the parent has set locations for where they can shop, kids can review those options here as well.
In Save, the kid can save up for a goal. For example, if the parents have set a child up for a $200 limit a month, but the child wants to save up for a new laptop, the child can allocate $50 a month towards buying that laptop.
In Give, the child can browse nonprofits and charities, and give either a one-time or monthly donation of a certain amount, as long as they have enough to cover.
I started drawing up some ideas and designs, first in a sketch book, and then using Sketch once I had a good flow.
Unfortunately, I am not able to show final designs, but am happy to answer any questions about the design & thought process!
Testing & Iterations
After finishing up a final design, I did some testing using Invision. There were certainly some critiques of my design (my weakness, I’m not afraid to admit, is in visual design), and concerns about the layout. I made some adjustments in these areas:
- Maps to track spending locations on the parent app
- Icons on the kids app were confusing; use copy instead
- Option to request for an increase in monthly spending on kids homepage, as well as in the “Spend” section
Since this was more of a study to see what a product in this space would look like, no final prototype has been created as of yet. I presented my studies and designs to my client and stakeholders, and am available and willing to continue my work!
One of the biggest lessons I learned from this project was that you never really know something. I use a credit card on a daily basis, and have for many years. But there were many things I still didn’t know; rules and regulations, common practices, design strategies, etc.
I needed to forget everything I thought I knew, and learn again. This is one of the hardest things to do as a designer, see with fresh eyes. But with practice, curiosity, and empathy, it is always possible.