UK BANK COMMENTS ON KIDS' VISA CARDS

4 July 2008

Children should "let their parents know" says bank spokesman


The British newspaper The Daily Mail has triggered a furore in the UK over the despatch of Visa cards to account holders as young as 11 years old by major bank TSB Lloyds.

The newspaper quotes a complaint from an anonymous parent, who claims that he had protested to the bank after his 15-year-old son used his card to buy cheap cigarettes, Viagra and a fake adult ID online. The Dail Mail reveals that other parents have also complained.

The newspaper explains that in the past children aged between 11 and 15 who held current accounts were restricted to using their bank cards at cash machines. However the new cards are Visa-enabled, and can be posted to youthful account holders without their parents' consent.

A spokesman for the bank told The Daily Mail that it is only falling into line with its rivals in providing the service.

"In line with industry practise, we have started to offer customers under 16 the option to have a debit card," he said. "Importantly, we do incorporate restrictions, which are unique to Lloyds TSB.

"We made it clear that they should let their parents know."

The bank added that the debit card does not allow customers to overdraw and prevents purchases on adult gambling and sex sites.

Parents or guardians can request that a card is not issued, and block it if it is misused.

Politicians entered the row when the Liberal Democrat spokesman on Treasury issues, Vince Cable, accused the bank of trying to "seduce" customers at an early age, telling the Daily Mail that "....it is deeply dispiriting" and that "....this is clearly motivated by short-term greed".

"You would have thought banks might have learned some lessons by adopting the grossly irresponsible policy of encouraging youngsters to spend on these debit cards," he said.

Chris Tapp, Director of the money education charity Credit Action said "it goes against common sense for banks to cut parents out of the loop" and that "children may be swayed by advertising or other influences to make an impulse buy".

The Lloyds TSB spokesman said the bank is willing to investigate how the teenager could buy cigarettes, Viagra and a fake ID despite safeguards.

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