Beyond the Promotional Piggybank: Towards Children as Stakeholders

"If financial institutions are to deliver real value for children and move beyond the promotional piggybank,...their activities must be grounded in an understanding of children's human rights and involve children and youth as stakeholders."

The Second Annual Child and Youth Finance International (CYFI) Summit & Awards Ceremony (Istanbul, Turkey) was a dialogue between 70 youth from 40 countries and 346 senior-level participants from 83 countries representing governments, financial institutions, non-governmental organisations (NGOs), children's rights advocates, and academics. Launched at the event was this discussion paper, which is a joint effort by the United Nations Children's Fund (UNICEF) and CYFI aiming to facilitate and encourage feedback and sharing. It uses the Children's Rights and Business Principles framework (developed by UNICEF, the UN Global Compact, and Save the Children) to outline processes that can help financial institutions consider children's rights effectively. Featuring several specific case studies and examples of theory in practice, the paper outlines a 5-step process: (i) develop policies, (ii) assess potential and actual impacts on children, (iii) integrate and act on findings, (iv) monitor and communicate on performance, and (v) create systems for complaints and remediation.

The introductory section provides context. It is explained that "[i]nvesting in sound financial products for children and youth is good business for banks, both socially and financially." For instance, "today's children are much more at ease with social media and mobile technology - by understanding and responding to their needs and interests, businesses can be challenged to be creative and to explore how to leverage such technology to provide better services for clients." Furthermore, there are many benefits to youth; for example: "Inclusive financial systems facilitate economic growth and increase income equality, and they are particularly likely to benefit disadvantaged groups such as youth, including girls and young people in rural communities."

Subsequent sections offer due diligence processes to guide financial institutions in integrating child rights - putting the Children's Rights and Business Principles into practice. One example cited is the role of financial institutions in preventing commercial child pornography. "By working together with their peers and Internet service providers, they can make a significant difference by following the flow of funds and shutting down the illegal payments accounts." Other selective concrete examples that illustrate the Principles in practice include:

• "Financial institutions can play a key role in preventing theft or misuse of children's identities. Policies and protocols for data security, credit fraud, privacy and confidentiality may need to be reviewed to ensure children are afforded adequate protections to prevent such theft. Moreover, financial institutions may also need to consider how they can support child victims of identity theft and how they can simplify processes to re-establish credit history and ratings. Beyond policy-level actions, financial education efforts can also support children by raising awareness of the risks of sharing personal details online."
• The "global youth unemployment crisis" has led youth in both developed and emerging markets to delay milestones such as moving out of the parental home and finding a first job. According to the report, this crisis has implications for financial institutions, such as the need to adapt lending criteria; it also "may mean great opportunities to support youth through skills-building and promoting young entrepreneurs."
• "Financial institutions should consider how to increase accessibility to the product or service to all children, regardless of income level, gender, language, disability, religious or ethnic group, or other status....Islamic law, or sharia, prohibits acceptance of specific interest or fees for loans of money, as well as investments in businesses that provide goods or services considered contrary to this law. This can make it challenging for Muslim children and youth to access financial products and services that respect their religion.....The sharia-compliant 'imteen-i Account' is offered to children aged 12-18....The imteen-i Account has a spending limit of 500 ringgits per day, which is lifted when the child turns 18. Account holders are incentivized to study by receiving cash rewards for academic excellence on school exams. The linked 'myzone' [web]site offers general account information and includes a dedicated page with tips on how teens can protect themselves and their information online, including articles on issues such as phishing."
• To foster child participation and engagement in philanthropy, Nedbank, headquartered in Johannesburg, South Africa, has a "Nedbank4me Savings Account" which is designed for people aged 18 and younger. Children can choose one of affinities to link to their account at no cost. When the account is first created, Nedbank makes a contribution of 2.50 rand towards a charity related to the selected affinity. Every financial quarter thereafter, Nedbank makes a further contribution based on the average daily balance in the account. By saving more money, children are also able to give more to charitable causes. "The Nedbank example demonstrates how to recognize children as agents of change in their own lives and that of their communities."

With regard to evaluation, communication-related lessons to emerge include:

• "In both understanding context and assessing impacts, stakeholder consultations can be invaluable to understand children's concerns and perspectives. Engaging with relevant child rights experts and stakeholders such as parents or caregivers, teachers, community leaders, government structures, youth organizations, children's organizations, non-governmental organizations and others can help the financial institution more accurately understand its impact on children."
• "The company should be prepared to communicate externally on its performance on children's rights, providing sufficient information to evaluate effectiveness. Information should be communicated in a format accessible to intended audiences, including children, where relevant and possible.

In conclusion, the report stresses the need to involve children in their own financial lives through support actions that are rights-based and also based on a long-term investment in children. "Business actions to support children's rights should seek to be strategic - aligning business expertise, knowledge, presence and resources with the needs of children and communities."