UK fintech Beanstalk launches JISAs for parents with just £5 to invest
Beanstalk, the UK fintech helping parents invest for their kids, has launched its Junior ISAs (JISAs). Parents with just £5 to invest on behalf of their children can sign up.
Parents can open the JISA via Beanstalk’s app – available on the App Store and the Play Store – “in just two minutes”.
Co-founded by former Capital One employees, Julian Robson and Cem Eyi, Beanstalk is offering new competition in the UK’s child savings sector.
“While the fintech revolution has dramatically changed the landscape for much of financial services, it has passed the child savings and investment market by,” says Robson.
Challengers need to go beyond current accounts
As challengers continue to crop up with similar-looking current account offerings, fintechs addressing stocks and shares Individual Savings Accounts (ISAs) and JISAs are far and few between.
Chief commercial officer (CCO) at Dutch core cloud-based banking provider, Ohpen, Angelique Schouten, told FinTech Futures in June that these “more complex” offerings are still really lacking in good digital experiences, especially in the UK.
“There’s a reason they [challengers] just cannot handle the digital experience that comes with that customer,” says Schouten.
She points out that challenger bank’s technology needs to evolve and mature alongside its customers. Otherwise, these sorts of offerings simply aren’t possible on a mass scale.
“If you want to offer a complicated product like a stocks and shares JISA, be damn sure that it works with the kinds of volumes [challengers experience],” says Schouten
The start-up is offering both stocks and shares JISAs and ISAs. Users don’t need minimums or contribute regularly. The accounts take a 0.5% fee, which the fintech claims is “one of the lowest on the market”.
Beanstalk allows parents to contribute to these accounts in more ways than just regular contributions.
They can also add money through ad hoc top-ups, round ups on their everyday spending, or a cashback scheme with KidStart.
KidStart has roughly 2,300 partners. It lets users which shop with them put cashback into a savings pot for their children. Beanstalk’s co-founder Cem Eyi is also the chief operating officer (COO) of KidStart.
As well as allowing parents to put in funds, Beanstalk allows them to invite other family members and friends to deposit gift amounts in their children’s account.
Through the app, parents can choose the percentage split between a global shares fund and a cash fund. They can adjust this at any time using a slider interface.
“The child savings and investment market is broken,” says Eyi. “Traditional banks have no incentive to service the children’s savings market properly; it has required a new fintech approach to make JISAs accessible to everyone.”