American children from Generation Alpha hold $28-30 billion across cash, fintech apps and bank accounts, according to new research from Hyperlayer, a programmable banking technology provider.

The research, from the Kids & Money: The Unbanked Billions report launching alongside Hyperlayer’s presence at FinovateFall shows billions of dollars are held by approximately 33 million children aged 8 to 15 in the United States, around 23 million of whom keep their money outside traditional banking. More than half (52%) keep their money in cash, while just 28% say they use a traditional bank account. The report also covers the United Kingdom and Hong Kong, where the pattern repeats: across the three markets, around 70% of children in this age group keep their money outside the traditional banking system.

In the United States, even by the age of 15, over half of Generation Alpha (53%) still do not keep money in a traditional bank account. The timing is significant: an unprecedented transfer of wealth is underway, with $83 trillion globally expected to be passed on within the next two decades, according to UBS’s Global Wealth Report 2024.

The research reveals how American children are spending, making and thinking about money:

  • Just over half (52%) are doing chores at home to earn money and over a third (38%) do so by helping family and friends with babysitting, running errands, or doing yard work. Around one in eight (13%) show entrepreneurship by selling things they own or make.
  • More than two-thirds (68%) have up to $500. Overall, a fifth (22%) have more than $500, though only 4% hold above $5,000.

Reported balances rise as children enter their teenage years, creating a natural point at which banks and credit unions can help families move from informal money management toward more structured saving and spending.

“There’s an irony to these findings, which is that banks have something that fintechs don’t yet have – decades of trust,” said Rob Rooney, co-founder and CEO of Hyperlayer. “They’re in the perfect position to serve these kids and their families. The next generation is developing financial habits and brand preferences roughly a decade before the retail banking industry typically begins to pay attention to them. Financial institutions have an opportunity to support children and their families at the point when young people begin managing money for themselves. Institutions that provide safe, intuitive and flexible experiences early can build relationships that evolve as their customers’ financial needs become more complex.”

The Financial Confidence Crash

The research also points to a dramatic shift in how children think about money. Aged 14, around four in 10 (37%) of US kids think they’ll be rich as adults, but in just one year this confidence collapses – just 16% of 15-year-olds believe they’ll be rich in the future. Also, by age 15 more than half of Generation Alpha respondents in the United States define being rich as “not having to worry about money,” up from about a third at age 8, another marker of a drop in financial confidence that coincides with children taking on more responsibility for their own spending, but before most have access to the tools or guidance to manage it.

Where Kids Might Turn Instead

The research captures a generational shift already underway: 4% of children surveyed in the United States say they already turn to AI for help with their money, asking a chatbot how to save for something or getting a quick answer about whether they can afford to spend. Generation Alpha will be the first generation to grow up banking alongside AI agents, not just banking apps, raising the stakes for financial institutions deciding how, and with whom, they build that relationship.

For Rooney, the household relationship is the principal asset. “This is a generation telling us, clearly, what help it needs and why. The objective should be to become the brand the child grows up with, the rails the money moves on, and the bank that understands the entire family financial network. To be the institution the household knows and trusts. In a business where customer and member relationships are the whole point, that is not something to leave to chance.”

FinovateFall session details

Credit Union Spotlight & Networking: September 08, 4:30pm, The Marriott Marquis, New York.

A chance for credit union executives to connect with each other and speak intimately with a smaller group of carefully selected fintechs with targeted solutions for credit union.

Report methodology

Kids & Money: The Unbanked Billions is based on a YouGov survey of 3,981 children aged 8 to 15 (in the United States n=1,523, United Kingdom n=2,085 and Hong Kong n=373). The research also included parent focus groups conducted in the United States and United Kingdom with Roots Research. The complete report, including market-specific findings, is available at Hyperlayer.com.

About Hyperlayer

Built by bankers for banks, Hyperlayer is a banking technology provider. Its programmable layer enables financial institutions to change and innovate at fintech speed without disrupting the core systems they trust. Its configurable technology allows banks, credit unions and wealth managers to launch new financial products without replacing costly back-end infrastructure.

Hyperlayer is also the technology behind HyperJar, the award-winning consumer money-management and family-banking app in the United Kingdom.

Founded in 2023, Hyperlayer has raised $40 million in funding, including US investors Flintlock Capital and Susquehanna Private Equity Investments, with the round led by CDAM and additional participation from Mouro Capital and Iona Star.

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