Sky News business presenter Emma Crosby

Lloyds TSB makes it to the front page of the Daily Mail today as it reports that a 15 year old customer, who had just been given a debit card from the high street bank, bought cigarettes, Viagra and a fake adult ID online.

His Dad only found out when he received a Customs demand for duty on the cigarettes which his son had bought via an overseas web-based retailer.

So no doubt a very stern telling off for this South Wales teenager. His Dad is also none too pleased with the bank.

And this story has sparked a debate about the behaviour of our big banks. Should they be offering visa-enabled cards, which basically mean you can use them for more than getting money out of a cash machine, to customers under 16?

Well this case shows that the cards can be abused. Even though Lloyds TSB says it has a unique system to stop purchases from adult sites, if this report is accurate, it’s clearly not worked here.

What’s also irritated a lot of people is the way the bank has gone about this, writing directly to the kids to ask if they want this card and only suggesting they let their parents know about it rather than insisting on parental permission.

The Lib Dem Treasury spokesman Vince Cable goes as far as saying this is predatory behaviour, highlighting the fact that you are more likely to get divorced than change bank accounts.

So are banks trying to rope new customers in at too early an age? And post-credit crunch when the banking industry has been accused of fuelling our desire to spend beyond our means is this the correct way to teach young people about managing money?

Well may be it is. And in an internet age when kids are so computer savvy, buying music DVD’s and clothes with cash in a shop is almost pre-historic.

Maybe this is just a sign of the times and the spending habits of the internet generation.

Do let us know what you think.

Comments

[Khalid 30 Jun 2008 16:16:50]

Emma
In all the circumstances, by virtue of the fact that this is a debit card, banks appear to be erring on the side of legislation as it does not allow those under the age of 18 to obtain credit, however, surely if a 15 year old is legally entitled to earn a wage or even pocket money/grants, in todays electronic age, by rights he or she should be able to enjoy the same benefits of electronic transactions as available to everyone else, barr ofcourse the purchase of such adult material.
For all intents and purposes, my only [Objection] would be that such cards only be availabe to a person once they have reached the age of sixteen, an age at which many are able to enjoy the world of education surrounding sex and other such lifes fundamentals.
All in all,as in every case, there is always one who puts the banks to shame, and as such, if banks are intent on providing these luxuries to those under 16, they at least need to repsect the parents' legal responsibility until the age of 16, or forever hold their breath when things go wrong, as they cannot sue a person of such an age for matters arising under the remit of the Consumer Credit Act 1974 (as amended by the 2006 Act). Now that such systems have failed, perhaps they could start the card number with a C thereby every retail or other outlet would know, it is an underage transaction for items of such a delicate nature.
Happy shopping [Shakira]

[Danny, London 30 Jun 2008 15:42:04]

The issue isn't about the banks, but ultimately it is about parental upbringing. Why did the teenager want cigarettes, viagra and a fake ID in the first place? It doesn't matter whether these types of teens have access to a card or not, they will get their hands on what they want one way or another.

When I was 13 my dad allowed me to use his credit card online whenever i wished, so long as I had the money to pay the bills. It taught me financial responsibility, and the dangers of online fraud. But more importantly I never bought drugs. Just because this one teen tried to buy drugs doesn't mean the majority of other teenagers out there, which most of whom are responsible, will waste their money on the same things.

[Matthew Jones 30 Jun 2008 14:31:14]

Yes they should give them to young people - the cards in question are usually Solo cards which are restrictive anyway (like the Visa Electron). It is a good introduction to financial management and how things work. How can we expect them to understand and apply maths and PSE lessons (in managing your money) when you don't let them have a debit card (that can only be used in a few places anyway)?

[Michael Cornwall 30 Jun 2008 13:46:26]

You can't blame the banks. It is a story of 1 kid,I bet he he fooled the bank. Don't underestimate the kids, It may not be pretty,but they are very ingenious at breaking rules.Especially with the internet.