All of the Kwedit ducks (as we proudly refer to ourselves) have been pleasantly surprised and excited by the huge response we’ve received since we launched, most of which has been positive. We’ve also seen a number of comments from folks who believe as a result of an incorrect statement in the New York Times that Kwedit Promise is available to users “of any age”, including “pre-teens”. In fact, Kwedit Promise is only available to teenagers and adults who are at least 13 years old. The use of Kwedit Promise by pre-teens is precluded by our Terms of Use.

We reported this error when the article appeared on Saturday. It was corrected the following Wednesday.

As for who will tend to use Kwedit most, the best data we can find suggests that the biggest market for Kwedit are users between the ages of 18 and 34, because they are the most active users of social games.

Kwedit Promise is not for kids. I have 2 children (8 and 6 years old) and they are not responsible enough to use credit -- in the virtual world online or in real life. While we’ve discussed the concept of “loans” and “spending vs. saving,” I am certain that if I started talking to them about debt, FICO scores or credit limits, they would be very interested in the “spend money now” part but not very understanding of the “you must pay it back, plus interest” part.

Let’s fast-forward 5 to 7 years to when my kids will be teenagers. Will I let them use Kwedit Promise? Absolutely! Kwedit Promise enables teenagers and adults to learn the concepts of credit by “borrowing” and “paying” small amounts of money (normally $5 or less) in a safe and fun environment. There are no real-world consequences. Nothing they do online will affect their real-life credit scores.

I only wish Kwedit was around when I was a teenager! I had no idea how to use credit responsibly, and when I graduated from college, I left with a diploma and ~$10K in credit card debt. Paying that debt off was a long and painful process. I shudder when I think of how much money I spent in interest on those credit cards and what I could have done with that money, or how much it would be worth if I had instead invested it. Today I have one credit card that I pay off monthly. I don’t want my children to learn about credit the hard way like I did. I look forward to using the resources we have for parents as a starting point for discussions with my teenagers about financial literacy.

Also, just as I will ask my teenagers to friend me on Facebook so I can keep an eye on their online activity, I will require them to share the details of their Kwedit Promises using Pass the Duck so I can monitor what they’re doing.

I liken Kwedit to learning how to drive. Would we let teenagers start driving a car on their own without the experience of drivers’ education or having a parent in the passenger seat, guiding them and offering advice? Of course not, so why shouldn’t we give teenagers a way to experience the advantages and pitfalls of credit in a safe, consequence-free environment with parental guidance, before they enter a world of multiple credit card offers and high interest rates? Certainly, the consequences of poor driving skills are potentially lethal while those of financial irresponsibility are not, but the recent debt crisis clearly points to the need for better education about how to use credit.

The Kwedit team designed Kwedit Promise to provide a safe, fun simulation in which adults and teenagers can learn how to make Promises responsibly and pay them back. We encourage parents to use our resources, including our Kwedit Kontract, to talk with their teenagers about the pros and cons of using credit.

Yes, Kwedit is a business, but we believe that doing well doesn’t mean we can’t also do good. We are committed to making Kwedit a great tool for learning about the use of credit in a no-risk environment.

Quack On!

Loree Hirschman

As we developed Kwedit Promise, I bounced the idea off of friends, game publishers, fellow parents, potential investors, and, of course, my wife. Responses ranged from “This is brilliant!” to “This is insane!”  … to the occasional “huh?” Many were intellectually intrigued (“You’re building a laboratory for behavioral economics!”  “Kwedit Scores…what a fascinating machine-learning problem!”).  Publishers saw the potential for their businesses (“Finally a way to expand my addressable market!”).  Still others viewed Kwedit Promise through a lens of morality (“What a great way to reward honesty!” “I don’t trust anyone… no one will ever pay you back!”).

This feedback reinforced our view that the world is a complicated place populated with honest and dishonest people, and our system should anticipate both. We should reward honest people for being honest, and we should try to stop dishonest people from abusing the system. That’s why we implemented Kwedit Scores and Kwedit Limits – features that provide positive and negative consequences in Kwedit’s virtual world without impacting consumers in the real world in any way.

My wife emphasized the importance of parental oversight, so we developed the “Promise sharing” feature of Pass the Duck that allows parents to supervise their teens’ Promises, and we created the Kwedit Kontract for families.

A friend who has been working to resolve the debt crisis got excited about Kwedit Promise and said, rather forcefully:  “Most people have had no way to learn about credit until it’s too late. Kwedit provides an opportunity to help people learn.” That's why we promote Kwedit Promise as a safe environment in which teenagers and adults can safely learn about and experiment with the life-impacting concepts of credit scores and credit limits. It's also why we provide links to financial literacy sites.

Regardless of your view of the world, we hope you’ll take advantage of all that Kwedit Promise has to offer – intellectually, educationally, or, perhaps most importantly…just for fun!  As always, we welcome your comments.

Quack On!

Danny Shader

Launch!

Today is a big day for our team. Kweddy has hatched and Kwedit is here!

What is Kwedit? It’s a payment network that allows people who do not have a credit or debit card, or who prefer to pay with cash, to purchase digital content and virtual goods easily and safely.

Who do we serve? In addition to the 20+ million American teenagers who primarily use cash, another 30+ million American households lack a bank account and/or credit or debit card, or prefer not to use them for online purchases. These folks have had the desire and means to make online purchases, but have lacked a convenient and secure way to do so – until today.

Kwedit empowers these consumers with two services:

Kwedit Direct, which allows consumers to make payments at over 5,800 7-Eleven stores in the United States; by mailing cash in a free, postage-paid mailer; or by asking friends or relatives to pay on their behalf via the first-ever social payment network — Kwedit’s “Pass The Duck”. If they agree to do so, those friends or family members can use any of the “ways to pay” that Kwedit Direct provides… or they can Pass the Duck to someone else. They can even use a credit card.

Kwedit Promise, which allows consumers to obtain digital content and virtual goods now in exchange for Promises to pay for them later. To pay back their Promises, consumers can use any of the ways to pay provided by Kwedit Direct, including Pass the Duck. Beyond allowing consumers to Play Now. Pay Later.™, Kwedit Promise provides a safe, virtual environment in which consumers can learn about credit and develop financial literacy – with no real-world implications.

Here are demos of our services; please take a look, or read a more detailed description.

We believe Kwedit can have a huge and positive impact on publishers because our services allow a whole new group of users to purchase digital content and on-line goods: people who “would pay if they could pay but can’t pay so they don’t” … before Kwedit! We’re also excited that publishers who sign up today can accept payments nationwide tomorrow at thousands of 7-Eleven stores, via millions of mailboxes, or through tens of millions of friends and relatives.

If you check out the site or use our service, we’d love your feedback. We’re going to be growing and changing, and your participation will help make us better. Send us some suggestions and our kwacker-jack team of developers will get right on ‘em.

Quack On!

Danny Shader