Beanstalk, the family app that invests for your kids, today launched instant transfers for top-ups to its Stocks and Shares Junior ISAs. Working with tomato pay, as its Payment Initiation Service Provider (PISP), Beanstalk is bringing the fintech power of Open Banking to child savings and investments and disrupt a market that has to date been reliant on largely manual, complex and costly processes.
The addition of PISP-based transfers means families can now make instant payments to their Beanstalk JISAs and ISAs, including roundups and ad hoc top-ups of any amount.
Almost 1 million Junior ISA accounts were subscribed to in 2019 to 2020, with £971 million saved during this period at an average subscription of around £5,740, according to the latest HMRC statistics. However, many stocks and shares Junior ISAs, which account for 40% of all JISAs, are complex to manage, costly to maintain and cumbersome to contribute to. By bringing the speed and flexibility of open banking to Junior ISAs, the Beanstalk App is bringing affordability, flexibility and transparency to the child savings and investment market, giving families the ability to easily build a nest-egg for their children.
“It has been a frustration that the instant transfers that people are used to in their everyday life, be it paying household bill or doing some online shopping, have been absent from child savings. It’s as if the industry decided there wasn’t enough in it for them to merit innovation, and as a result been failing our nation’s children,” said Julian Robson, CEO and co-founder of Beanstalk.
“The reality is, however, that with Open Banking we can not only remove time-consuming and costly processes, but also deliver a superior user experience at a much lower fee for our customers. From day one at Beanstalk we’ve been committed to delivering the most accessible and affordable child savings and investments possible, so every family whatever their financial circumstances has the opportunity to build a better future for their children. The introduction of instant bank transfers is one more important step towards truly transforming family saving,” Robson continued.
How Beanstalk’s Open Banking instant transfer works
• In your Beanstalk App, select the Junior ISA you would like to transfer funds into and click ‘Top Up’
• Enter the amount you would like to top up, which could be as little as just £1; Add an optional personal message, so the child can see that they’ve been given some birthday money by their grandparent, for example
• Select how you would like to top up the JISA account - in addition to Instant Bank Transfer via online banking, Direct Debit and standard bank transfers are also available options
• Select your bank - and then Open Banking, powered by tomato pay, will transfer you to your chosen online banking app for authorisation. As you connect your bank account, payments are embedded within the app, removing the need to give Beanstalk you bank details
• Confirm the top up within your online banking app
• The funds will immediately be received in your child’s Beanstalk JISA account ready to be invested
Open Banking is the result of a series of Government-led reforms to the financial services sector which came into effect in March 2018, and which are designed to increase competition, reduce costs and help drive the creation of new services for customers. It is a secure way for your financial information to be shared between regulated financial services providers and your bank and then used to create new services that make it easier for you to find new ways to make the most of your money.
In addition to Instant Transfers, Beanstalk makes use of Open Banking to power its Round Up tool. You can either turn on ‘auto round up’ or go into your Beanstalk app and choose which payments you want to round-up by simply ‘swiping’ the transaction. You can even adjust that week’s total round ups. At the start of each week, Beanstalk initiates the collection of the total round ups through Direct Debit, with any round ups split between all the Beanstalk accounts with which you are linked.