Virtual Piggybank? Amazon Makes Play for Kids’ Allowances (So They Can Spend Them on Amazon)

Virtual Piggybank Amazon Makes Play for Kids' Allowances So They Can Spend Them on AmazonWhat next — Amazon taking your kids’ lunch money?

If the company could get schools to go along, probably it would try.

Please note that — pretty much under the radar — “Amazon Allowance,” a new offering that lets parents schedule monthly or weekly payments to their childrens’ accounts, is now here.

The Amazon account has a cash balance, like a gift card.

It reportedly helps parents who no longer have to deal in cash or buy piggy banks (Amazon accepts checks and bank transfers, and provides a way for the kiddies to shop Amazon without a credit or debit card).

“The initiative is significant in a few ways,” notes a Bloomberg story. “The e-giving (electronic gift card) market is projected to reach $14 billion in 2017, up from $6 billion last year, according to CEB, and U.S. retailers, including Wal-Mart Stores Inc., Target Corp. and JC Penney Co. have all made e-gifting a part of their strategy. It’s also a way to get younger shoppers accustomed to buying things on Amazon. And with Apple Inc. and Google Inc. aiming to turn smartphones into digital wallets, Amazon needs to keep shoppers close.”

In addition to Amazon account holders being able to set up one-time and recurring allowances for “family, friends, or employees that are age 13 and above,” now people can also “set up allowances for themselves to budget or save up for a purchase.”

Amazon execs feel downright philanthropic about the new program.

“Sending money to family or friends can be a frustrating process,” said Manish Bansal, general manager of gift certificates at Seattle-based Amazon. “A lot of early customers are using Amazon Allowances as a way to budget —whether through one-time or recurring allowances. We’re also seeing parents using Amazon Allowances to send money to college kids who need help buying textbooks and dorm essentials.”

Is Amazon teaching the value of saving — or spending?

Probably neither. But they will get a lesson in just how far a company will go to grab a customer early — and commandeer his allowance, if necessary.