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Pittsburgh bank adds $250 million over 10 years to its early childhood education program, which used Big Bird &Co. to break ice with skeptical parents.
October 5
For years, PNC's Virtual Wallet team has been working to make online banking so easy a child could use it. With its new 'S' is for Savings account, it may have met that goal.
The new account, launched last week, was designed with Sesame Workshop to introduce money management to preschoolers. It builds on ideas from its grownup counterpart, Virtual Wallet, which uses personal financial management tools to make online banking a more fun and educational experience.
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But even though the technology is different, the accounts' underlying concepts have a lot in common.
The focal point of the 'S' is for Savings account's online banking view is a series of jars that kids can use to split up their money. Each jar is labeled with a specific purpose: spending, saving and sharing.
This mirrors the design of Virtual Wallet, which is presented as three checking and savings accounts labeled as Spend, Reserve and Growth.
The Virtual Wallet model was "kind of a bucketing of money," says Michael Ley, vice president for Payments and e-Business at PNC Financial Services Group Inc. "What we learned from Sesame Street [is] the age-appropriate … concept of breaking stuff up into jars. It just made it easy for people to understand it."
PNC has worked with Sesame Workshop since 2003, and the two organizations
Parents that open an 'S' is for Savings account are able to create what Ley describes as "a scaled-down version of online banking," so that kids can interact with their money without inadvertently spending any of it. "They can't transfer money out of the account, whereas the parents can," he says.
Even though PNC built a childproofed version of the account, it is not meant to be a hands-off experience for parents.
"Our belief is that the whole experience is with the child and parent or caregiver," says Jeanette Betancourt, the senior vice president for outreach and educational practices at Sesame Workshop.
The 'S' is for Savings account "goes beyond the concept of the money itself … it's how you're thinking of dividing money," she says. The account establishes the basis for further conversations about money.
For example, when a family is in a store and a child asks to buy something, the parent can refer to the lessons taught within the PNC account "to talk about that purchase … and that people work for money," Betancourt says.
Within the online banking view, there are videos and other Sesame Street content designed to teach kids about finances. These are meant to be watched repeatedly to reinforce the ideas they teach.
Although parents are expected to use these resources with their kids, Betancourt says she does not have research to show whether adults in need of financial education would get the same benefit by using them alone.
But there is potential for grownups to benefit from these lessons, Jacob Jegher, a senior analyst at the research firm Celent, says.
"It's the same concept about: How do you teach a person to save? How do you teach them the appropriate amount to spend on different things?" Jegher says. "This young type of approach is very applicable to mass-market America."
The interactive elements of the PNC account are essential to keeping a child engaged, says Jegher, who has two young children.
"I put them on the computer and they just love anything interactive," he says. "Having this come from the home in a fun and interactive manner is something that is very much needed to be introduced at a young age to a child."
The 'S' is for Savings account is too different from conventional personal financial management tools to put it in the same category, Jegher says, but it nevertheless demonstrates where banks can go with PFM offerings.
"This is a great example of a financial institution that … there is a potentially great benefit to be had by actually segmenting solutions to different types of users," he says.
