The Barefoot Investor, Scott Pape, has taken aim at the Commonwealth Bank’s school savings program, accusing the bank of treating primary school children as “gold mines”.
Mr Pape, who rose to fame for his savvy financial advice, has long been an opponent of school banking programs.
In the second episode of his new series Scott Pape’s Money Movement, aimed at improving schoolkids’ financial education, Mr Pape accused the Commonwealth Bank of “commercialisation of the classroom”.
The bank runs the nation’s largest school banking program – the Dollarmites rewards scheme.
“My concern is that having Australia’s biggest issuer of credit cards in classrooms teaching kids about money is like having Ronald McDonald teach our kids about food nutrition,” he said in the episode.
“The thing that I don’t like about it (Dollarmites) is that I think it’s a marketing initiative. It’s a commercialisation of the classroom.”
Watch Scott Pape’s Money Movement on Foxtel’s LifeStyle channel, weekly episodes airing from June 23 at 8.30pm. New customers get a 10-day free trial. Sign up at foxtel.com.au
According to Mr Pape, 46 per cent of people open their first account with the Commonwealth Bank in school, and 34 per cent of people keep their first bank account.
This is worth nearly $10 billion dollars to the Commonwealth Bank, he said.
The Commonwealth Bank also pays schools a commission for each student signed up.
During a visit to a primary school in Perth for the series, Mr Pape showed how students received a token whenever they make a deposit and these could be redeemed for prizes.
“They (the prizes) have all got something to do with some Comm Bank branding on it which is strange,” Mr Pape says in the documentary.
“This is a gold mine for them (banks).
“This is one little school with 300 kids.
“If they can get hundreds of thousands of kids signed up … they go on to become customers and that’s worth a lot of money to the bank.”
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In response to the criticism, the Commonwealth Bank told news.com.au they were proud of the Dollarmites scheme.
“Our School Banking program reinforces the importance of regular savings, equips students with the knowledge of how to access and use a bank account, and provides structure for parents to support their children to save regularly,” a spokesperson said.
“We are proud of the program and the positive impact it delivers.
“It continues to have strong support from schools, parents and teachers, and is used by over 2000 schools voluntarily Australia wide.”
Mr Pape has launched his own initiative to teach primary and high school kids how to be smarter with their money through his new series.
He teaches high schoolers and primary school students the importance of saving and the dangers of credit card debt.
Primary school aged children are taught about the three “jam jars” – a splurge, smile and give jar – for spending, saving for something in particular, and saving up in case of emergency.
For teenagers, Mr Pape encourages them to start working young.
“I see a part-time job as the gateway drug of financial education,” he quipped.
“When you earn your own money you get to spend it, save some, you get to pay tax.
“All of this happens with four, maybe eight hours a week (of work). For me, this is just as important as any other subject for a kid to do.”
Mr Pape wants his program to eventually be rolled out “everywhere”.
“Financial education is the one core skill that every one of us is going to be tested on every day of our lives and it’s really important that we teach our kids it,” he said.