Digital Allowance: Protect Your Child's E-Money

Digital Allowance and Child Safety in the UAE – How Can We Protect Our Children's E-Money?

Financial education for children has undergone a radical transformation over the past decade. Whereas coins and banknotes once constituted pocket money, today more and more parents opt for digital solutions. In the UAE, it is becoming increasingly popular for children to access their own "wealth" through smart devices, whether it be a mobile app, prepaid bank card, or e-wallet. However, these conveniences bring new risks, particularly in the field of cybersecurity.

Digital Allowance: Convenient but Not Without Risks

The use of e-money is undeniably convenient: parents can easily transfer amounts, track transactions, and, if necessary, limit what their children can spend on. Child-friendly bank cards and digital wallets available in the UAE – which can block online gambling and adult content purchases, for example – help parents establish secure boundaries.

According to a 2024 survey conducted by research firm Toluna at the request of Kaspersky, 76 percent of children have their own smart device – phone or tablet – through which they independently browse and shop. This means that managing digital money is not just a financial issue but a technological and security challenge as well.

Children Make Financial Decisions in the Digital Realm

Today, financial awareness education cannot simply involve teaching children how to save or what is worth spending money on. Children's first "financial" decisions typically occur online: purchasing a game within an app, paying on a gaming platform, or buying a digital gift card. These decisions can have real consequences – for example, if they download malicious apps, enter their data on phishing sites, or overspend carelessly.

The survey revealed that 31 percent of parents have already lost money due to their children's online behavior, and 19 percent reported that their child's device had been infected by a virus. This highlights that access to digital money can also make family finances more vulnerable.

What Protective Steps Can Parents Take?

Experts suggest that prevention lies in increasing awareness. Some practical advice:

Use child-friendly digital wallets or prepaid bank cards: These make it easy to restrict purchase categories, set spending limits, and provide transparency in children's money usage.

Two-factor authentication (2FA): It is advisable to enable two-factor authentication for any application where online purchases occur. This makes it harder for unauthorized parties to access the account.

Use and manage strong passwords: It is worth teaching children from a young age not to use simple passwords, not to share them with others, and to use password manager apps.

Install cybersecurity solutions: A reliable antivirus, parental control app, or firewall can help protect devices from malicious software and phishing attacks.

Financial education in a playful form: Numerous digital applications are available that teach children budgeting, saving, and responsible money management in a playful way.

Digital Finance – A New Challenge for Families

Digital allowance not only represents a technological change but also a shift in the mindset of families regarding financial education. Children can learn how banking systems work, how to shop online safely, and why it is important to protect their personal data. This also prepares them for the future job market, where digital financial competencies will be considered essential skills.

As experts emphasize, financial awareness cannot be complete without cybersecurity knowledge. If children do not recognize phishing attempts, fake payment sites, or malicious applications, they can easily become victims – even during their first digital transactions.

Dubai and the UAE Support Financial Education

In the UAE, several initiatives support young people's financial education – whether through school programs, digital financial workshops, or banking apps designed specifically for children. In Dubai, there is particular emphasis on ensuring that future generations are not only technologically prepared but also conscious and safe money users.

The future can indeed be both digital and secure – provided that parents, educators, and technological actors work together to ensure that children possess the appropriate knowledge and tools. This protects not only children's money but also their personal data and trust – perhaps the most valuable assets in today's digital world.

(Source of the article is based on research by the Toluna research advisory firm.)