Digital banking for kids
SAFE BANKING: Experts say there's no turning back from digital banking. The biggest challenge is safety, reliability and usability. Parents can set all sorts of controls for their children's digital bank account, from how much can be spent weekly to what shops the debit card can be used in, or whether it can be used online. Image Credit: File/Gulf News


  • For the first time, children as young as age 8 can open a digital bank account in the UAE.
  • Many clients want to bank anywhere, anytime on whatever device., and to do itn a seamless and cost-effective, if not free, way.
  • Digital banks have a tech advantage, which results in lower cost of serving clients.
  • Opening and maintaining a bank account for kids pose some challenges for parents.

[A.K.S. Satish, Assistant Editor; Alex Abraham, Senior Associate Editor; Ashfaq Ahmed, Senior Assistant Editor; Babu Das Augustine, Banking Editor; Jay Hilotin, Senior Assistant Editor; Nivetha Dayanand, Web Editor; Sahar Ejaz, Staff Writer; Seyyed Llata, Senior Designer; and Sharon Benjamin, Features Writer contributed to this article.]

ABU DHABI | DUBAI: Innovation — embracing fresh ideas — is the key to progress. That's true since metal replaced stone, and Android/iOS killed rotary phones. Now, banking is on a cusp of disruption.

UAE banks, in the past, had rolled out innovative savings accounts for children. This helped plant the habit of saving, made kids smarter with money, and also egged parents on to begin saving for their kids early. Fast forward to digital banking era. There's a new normal: quick sign-up ("on-boarding"), an app-based relationship, fresh opportunities — but also risks.

Putting together an easy-to-use, secure banking ecosystem for kids and millennials, however,  is no child's play. Competition is stiff, and is only set to intensify. Many banks, both legacy institutions and newcomers, do offer sweeteners: greater interest/profit rates than "normal" savings rates, low or no-minimum-balance requirements, minimal documentation, special discounts and offers linked to such accounts.

With all banks embracing digitisation, online on-boarding often uses just mobile phones. And it's just the beginning.

Financial literacy, inclusion

A number of conventional and Islamic banks in the country have savings accounts specifically aimed at children. By creating special accounts for the young ones, banks convey a socially relevant message: when you save for your child today, you help secure their tomorrow.

What is a savings account?
It is a type of account is a highly liquid; which allows customers to secure their finances while earning interest/profit on the balances.

The flexibility is attractive for both children and their parents.

Digital banks in the UAE

Here is a closer look at UAE bank accounts for children, students, adults in the UAE, and the new generation of digital banks in the country:

Digital bank UAE how many how it works
Image Credit: Seyyed dela Llata / Gulf News

Leading banks in the country such as Dubai Islamic Bank (DIB), Emirates NBD, First Abu Dhabi Bank, Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Commercial Bank of Dubai and Sharjah Islamic Bank have savings accounts specifically targeted at children.

DIB’s Shaatir Savings Account

DIB’s children’s account is called ‘Shaatir’ which means smart. In some cases, it is a compliment given to a child for doing a good job. DIB Shaatir Savings Account is a smart option to secure your child’s future. Opening a Shaatir Savings account allows account holders to maintain a separate bank account with more benefits that multiply the savings and the opportunity to earn good profit/interest.

Emirates NBD’s Early Saver

Emirates NBD EarlySaver account and deposit is a savings account for children. It offers interest on savings, insurance cover for children, exclusive entertainment offers. The account offers the option to open an EarlySaver Deposit with each EarlySaver Account. The product allows customers to open multiple accounts and deposits for their children. While the insurance linked to the account ensures financial security for the child, it also comes with exclusive entertainment offers and a supplementary debit card.

First Abu Dhabi Bank’s First Step Savings Account

FAB’s First Step Savings Account is available to children under the age of 14. This account offers special interest rate of 10 basis points (bps) higher than standard savings account. The account comes with free FAB MasterCard Platinum debit card that has exclusive airport lounge access.

Sharjah Islamic Bank’s Hassalati Account

SIB’s Hassalati Account is a very simple account for children between age 0-18 years. It comes low minimum balance and an opportunity to earn profit (interest). This is an Islamic savings account with a low minimum balance of Dh500. The profit paid on this account paid monthly.

Emirates Islamic Child Savings Account

This is an account specifically designed for children and offers profit (interest) with no minimum balance requirement. This is an Islamic account that offers the option of a free debit card and Life Takaful (Islamic life insurance) cover of up to Dh120,000. While the account is free on any maintenance charges, it also does not offer any rewards.

CBD Mustaqbali saving scheme

This account targeted at children can be opened in different currencies and has no minimum balance requirement. The account offers a free gift at the time of account opening and comes with a life insurance coverage.

What is Islamic banking?
Islamic banking, also referred to as shariah-compliant banking, refers to finance or banking activities that adhere to shariah (Islamic law). Two fundamental principles of Islamic banking are the sharing of profit and loss, and the prohibition of the collection and payment of interest by lenders and investors.

The principles of Islamic banking are derived from the Holy Quran, the central religious text of Islam. In Islamic banking, all transactions must be compliant with shariah, the legal code of Islam.

Bankers who are employed by institutions that abide by Islamic banking are entrusted with not deviating from the fundamental principles Islam while conducting business. When more clarity is necessary, Islamic banks turn to Sharia scholars.
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PARENTAL INFLUENCE: Studies show that parental influence, peer pressure and financial literacy help teach kids about the value of money. With the ease of digital bank on-boarding, kids will learn how to budget, save up for goals and spend responsibly using our easy-to-use app and website.

Amwali: A bank account for kids from 8 years old 

A bank account for your 8-year-old in the UAE. Abu Dhabi Islamic Bank (ADIB) introduced this unique concept on August 23, 2021, called ‘Amwali’. It is the world’s first Islamic digital bank for Emirati and UAE residents between the ages of 8 to 18.

How is Amwali different from other digital banks?

Amwali is different from all other Islamic banks as it not only offers savings account; it is the first Islamic digital bank for young people, accessible via an application. Amwali is a stand-alone app, which many others don’t have.

Steps to open an Amwali account:
• Using your (parents) existing ADIB account, and the ADIB mobile app, you can easily open in a while the account for your child.

• Share the QR code with your child, they will be able to download the app and activate access to their account. With ADIB Amwali account, your son or daughter will have a world of privileges, starting with a debit card with a design they will pick.

• They can easily manage their saving goals, let's say they want to save for new headphones, so they will just open a savings goal for this and start regularly putting money into it.

• They can transfer money to their friends on Amwali instantly and track their spending. They will be able to use their card on the app store for online shopping, they will enjoy exclusive offers for things they typically spend on so they get for with their money.

• The parents will have full control over the children's and while the account and debit card.

What parents say 

Ashfaq Ahmed

It was quite tough to open a bank account for my teenage son last year. Most banks required a lot of documentations while others simply refused to open an account for the teenager. I finally got positive response from the bank I am holding my accounts. I helped my son, Sinan Ahmed, open his bank account last year as he wanted to save some money and wanted to learn about ‘finances’. His main objective to have his bank account is to do online shopping especially to buy his books and games.

Children, however, need guidance to operate their accounts. I made him go through the complete process of opening his account to using the ATM. I also put a limit on his ATM card so that he should not lose his money in case he is exposed to any ‘online scam’. It is also important to keep track of their transaction and parents must have their banking log in details to ensure their accounts are safe. Parents should also keep depositing their pocket money in their accounts to empower them. My son gets very excited whenever he receives ‘money deposit’ message. 

Susha Alex

Banking for children is a great idea and will help kids understand the value of money at an early age. Very often, children are left to grapple with money and handle their accounts when they leave home to study in another country.

They struggle to handle money because they have not been given the freedom to save or spend. However, if they are allowed to open an account, under the supervision of their parents, they can be taught to handle money, save for a rainy day and use it wisely. It will stand them in good stead as they grow up and help them be responsible citizens.

A minor account, not a big deal anymore

A.K.S. Satish 

I would digress a little and talk about the evolution of banking as I had experienced as a teen, then as an adult and now as a parent. First let me talk about the recent one as an expatriate parent who reach the crossroads vis-à-vis children's education. I am sure everyone would keep multiple options open in regards to their children's higher education. I, too, was in that situation when my daughter was in Grade 12 a few years ago, before the pandemic struck.

Coming from India, certainly home country is one of the options. As a preliminary set process, I set up a bank account for her, even when she was a minor. The reason: should she come and study in India, it would be easy for her to use the account and since it’s in the same bank and the branch as mine, it would be easy to transfer funds.

With that thought in mind, I opened an account and was told that she would get an ATM card when she turns 18. During that time, it would no longer be a minor account, but a fully operational individual account.

My memory then went back a few decades when I first opened my account, with my dad's help, as a "minor account" as well.

- A.K.S. Satish

My memory then went back a few decades when I first opened my account, with my dad's help, as a "minor account" as well. I was handed over a hand-written passbook after the bank official made a note of my account number in a ledger book. After opening the account one has to deposit some funds into the account and hand over the receipt to the bank staff. To know your account balance, one had get the passbook periodically updated in the bank, for which there will be a long queue.

What a difference today. Once, I got a complete kit, including an ATM card when I opened a priority account and all transactions are done online. Maybe the millennials would not know what it means to visit a bank. Most of the bank transactions, and purchases are done via smartphone.

I am also reminded of another incident when my cousin, who was investing in a property, fell short of Rs50,000. It was in the 1990s when not many ATMs were available and one could only withdraw cash from certain branches. As my account was a salary-transfer account closer to my workplace, I was some 12 kilometres away from my office/bank, but the branch would close by 2.30pm, which left me with about 35 minutes to enter the branch before the shutters are down. I took my car and drove like a maniac; my father-in-law, who insisted on joining me for the trip, kept calming me down all through the trip. Thankfully, I reached the branch 5 minutes before the shutters came down to collect the cash.

A.K.S. Satish's family in 2019.
A.K.S. Satish's family in 2019. Image Credit: Supplied

Today, one can withdraw cash any in time and make a transfer anytime of the day without any hassle. What an evolution the banking industry and the customer experience has undergone in the last couple of decades!

Coming to the present, things didn’t go the way as planned. My daughter instead joined a university in Germany and didn’t need this account at all. What’s more, she waited a few days after joining the university and after turning 18 opened her own account at her preferred bank. This banking experience has also taught her to budget her expenses and not splurge the cash that’s in her account.

First person accounts:

A good opportunity to start saving some money

Sinan Ahmed, 16, Pakistani student in Dubai

“It is definitely a good idea to open a bank account when you are young so you experience money management before you become an adult and have a job. Also, it provides a good opportunity to start saving some money without the fear of losing it.”

Sinan Ahmed
Image Credit: Supplied

“I opened my bank account at the age of 15. Since then, I feet more confident with my ATM in my wallet. It has made me more responsible with money and being more aware of risks. It helps me make my payment process faster and more secure. It makes it easier to send and receive money, shop online, book movie tickets and buy my books. Teens should be able to open a bank account as long as they receive proper guidance.”

'I had nowhere to redirect my monthly salary to'

Sahar Ejaz, 25, Staff Writer

When I started my part-time job in university, I had nowhere to redirect my monthly salary to, and carrying around cash didn’t seem feasible, either. Not having a card on my person became inconvenient, especially when I had to make payments on digital platforms where cash simply would not do. At the time, Liv. was all the rage among my friends. Frustrated, I hopped on the bandwagon, downloaded the mobile app and started the sign up process. All I had to do was click pictures of my Emirates ID (salary certificate is not a requirement), and my new debit card was delivered to my doorstep free of charge. Until I turned 23, I never incurred any charges on minimum to zero balance.

Sahar Ejaz
Image Credit: Supplied

The thought of opening a bank account had always intimidated me. For one, all the red tape involved in the process was enough to make me stuff my big bills into a drawer. It had been ‘no, thank you’ for years until I learned of a bank that catered to residents on student visa. My financial activity with Liv. went as far as withdrawing cash from any Emirates NBD ATM (also free of charge) and shopping online.

But as with all things digital, the lack of a physical entity proved increasingly difficult when chat bots were the only customer service representatives you could turn to. No longer a student, I am now with a different bank. Though, I will say that briefly going digital made for a perfect stepping stone to opening with an onsite bank.

'Student-friendly account'

Sharon Benjamin, Features Writer

As a Dubai kid, one of the main things I always looked forward to was opening a bank account in my name. While I had one of my own while I was studying in India, it just didn’t feel as exciting. And so, when I was hired as an intern for Gulf News, the first thing I asked everyone I knew was which bank is the best in terms of convenience.

Since most banks require a salary certificate and a minimum salary amount for someone to open an account, my friends told me about Emirates NBD Liv and how it was ‘student friendly’. It seemed like a wise decision especially since you only need your Emirates ID to register with them.

Once I typed in my details, I was given three options – to use it as a salary account, to spend Dh1,000 every month, or maintain a minimum balance of Dh2,500.

My friends referred the bank to me due to convenience reasons and especially since you could do everything on the mobile application without having to wait in long queues and crowds... I could create budget plans, saving plans, pay bills and even track my expenses quite easily without actually downloading a money manager application separately.

- Sharon Benjamin, 24

My friends referred the bank to me due to convenience reasons and especially since you could do everything on the mobile application without having to wait in long queues and crowds. But other than this, I could create budget plans, saving plans, pay bills and even track my expenses quite easily without actually downloading a money manager application separately.

While most banks have mobile applications, Liv was also visually designed well and is pleasing on the eyes. As someone who’s personally into art, typography and anything to do with UI (user interface), I was very impressed with the animation and visuals altogether.

Apart from this, there are a lot of things which were beneficial for me, although if I had to mention a downside, there used to be Dh15 deduction from my account every month despite maintaining it as per the criteria given to me. I often think it’s because of the international transactions I used to make, but now I’ll never know because I switched to Emirates NBD last month.

Why? Well, I was no longer an intern and I did want to close it since I would cross the age eligibility next year. Overall, it’s a great place to start if you’re looking for an easy-to-maintain bank account.

Can I open an account — in just 4 minutes (without leaving your house)?
Quick answer: Yes. This greatly simplified process will be the “new normal” with digital bank.

Given the speed and convenience of social media, people now expect that same experience with their banks.
Digital banks Jaroudi
Image Credit: Supplied / Jay Hilotin

What does it mean?

Digital-only banking is banking on your smartphone with no paperwork. In short, it’s challenging the Medici model of banking — the idea that a bank is a place where you go. Today, banks live in the “cloud”.

How are banks adapting to digital banking ecosystem?

Experts say “fintech” is doing to banks what YouTube has done for TV. Faced with disruption, the industry must take the new reality in earnest. Result: the banking tech stack is getting overhauled— $297 billion in bank IT budgets are earmarked this 2021, a 14% jump from 2018, according to Celent. Teams are getting restructured, with everyone now centred around “customer experience” — keeping clients happy. But in banking, “happy” is a big word, a moving target to constantly chase.

Sacha Holderegger digital banking
Image Credit: File

"Many clients want to bank anywhere, anytime on whatever device and this in a seamless and cost-efficient way. Digital banks have a technology advantage here which results in lower cost of serving cients,” Sacha Holderegger, Strategist, CIO European Equities at UBS Global Wealth Management.

Does the UAE have a strictly digital-only bank?

Some of UAE's mega-banks already have gone live with their digital banking spinoffs. For example, EmiratesNBD has launched LIV., its digital-only bank in 2017. RAK Bank, Mashreq, ADIB, FAB also have their own versions. Zand, based in Dubai, and Al Maryah Community Bank, based in Abu Dhabi, are both stand-alone digital banks.

Why are they mushrooming?

It’s what people want, or expect. And it's also thanks to the ubiquity of mobile phones, high-speed access and powerful-and-cheaper computer servers. Digital banks offer customers “richer” experiences, via increased banking privileges and exclusive lifestyle treats.

Digital banking adoption continues to become even more popular in 2021, according to Gaurav Singh, CEO
and founder of chatbot company Key trends:

• Personalisation: Beyond customer account balances, consumers increasingly want access to information about their finances to make more well-read decisions about their money and economic goals.

• Real-time Payments: With social distancing and concerns about COVID-19 on everyone’s mind, contactless payment forms grew more popular this year. We consider that this trend is here to stay even after the approval of a COVID-19 vaccine.

• Automation: This enables banks to achieve operational agility and capture substantial cost efficiencies; it also helps them deliver the digital experiences that customers increasingly demand.

How are other countries embracing this trend?

In the US and Europe, traditional banks have taken forays into digital-only set. At the same time, new entrants have sprung up — from phone companies partnering with retailers and ride-share companies, to gaming companies joining forces with supermarkets. Such solutions have greatly improved the life of people, but has caused disruption in the money trail.

What are the top digital-only banks?

In China, WeBank (Tencent) and MYBank (Alibaba) are the Top 2 two digital banks. In the US, there’a Moven Bank, Simple Bank, GoBank, MoneyLion, BankMobile and Chime. They also known as “neobanks”. In terms of digital banks with the best (free) fees, there’s Ally Bank, Charles Schwab, Capital One, USAA and TD Bank.

Where is the digital-only banking industry going?

It’s only set to grow. Its biggest draw is simplicity. Benefits include:

  • Easy sign-up
  • Quick balance check features through mobile platforms
  • Photo-bill payments: snap a pic and the app pays your bill from your account.
  • Access accounts exclusively through app, reset pins, order cards, etc.
  • Easy expense management, through different hashtags like #expenses, #utilities and other spendings.
  • Real-time data analytics

But to pull of that simplicity, an inordinate amount of complexity runs behind-the-scenes. And competition is intense. UBS' Holderegger said: "Issues some of these 'neobanks' may have is to build up scale, client loyalty and high-adding value services. This was seen last year when leading neobanks witnessed a significant drop in the number of new app downloads in the wake of the COVID-19 pandemic.

"Also, most large traditional banks are significantly investing in their digital capabilities through own solutions, third-party solutions or joint ventures with technology leaders. It's a very competitive field."

Top 50 digital banks
The world's Top 50 brands in digital banking Image Credit: Gulf News / Jay Hilotin