Now a San Francisco start-up is aiming to change all that. Using a "virtual wallet" system, iCanBuy.com hopes to make it as easy for parents to give their kids online spending money as it would be to drop them off at the mall with $20.

"We're empowering teens and kids to shop, save and donate online," said R. Paul Herman, CEO and co-founder of iCanBuy, funded by the private company BlackBox Internet Group Inc., also in San Francisco. "We offer merchants the ability to do commerce with a large and growing segment of the population, and teens and kids the ability to do e-commerce in a convenient, safe way."iCanBuy (icanbuy.com) was launched Tuesday last.

Solves a Problem

Industry observers agree the company is meeting a real need. "It's one of those initiatives in the online space that absolutely solves a problem," said analyst MarcJohnson of Jupiter Research. "The problem of how do you unlock kids' commerce...has made it nearly impossible for companies to...monetize kids' traffic. This looks like a compelling way to do that."He said the biggest barrier to success won't be signing up partners or even parents, but convincing kids and teenagers to use the system.

"In their case, what's cool and what's not changes rapidly," Mr. Johnson said. "Having the parents involved in administering the wallet is a necessary aspect, but whether kids will want to participate in that is hard to say."

Prior Obstacles

Youngsters have been hindered, so far, from spending online because of two factors: They usually don't have credit cards of their own, and parents often have concerns about giving their credit cards to kids for online spending.

But the prize lying beyond those obstacles is great: iCanBuy cites findings from Teenage Research Unlimited that puts the direct spending power of teens and kids at $141 billion a year.

The company'ssolution is to let parents set up an account for their kids, which draws on the parent's credit card. Parents can give their kids an online "allowance" or deposit a lump sum.

And they can rest assured that their credit-card information is safe, iCanBuy says, since the system only works with approved merchants.Companies such as Outpost.com, apparel seller Alloy Online, American Eagle Outfitters and others have made their products available on iCanBuy's site, and the company says names such as Amazon.com are in the works.As a nod to the virtues of financial management, teens can also make deposits to a savings account via Security First Network Bank, engage in chatrooms on financial topics or donate to such charities as Child Welfare League of America. One thing users won't see in the near future is auction sites, which iCanBuy doesn't consider secure and safe enough to introduce to the system.

Mr. Herman believes parents will be eager to find a trustworthy, convenient alternative to shuttling theirkids around to shopping areas.

"Parents don't have to go to the mall, and they don't have to worry about the safety of the mall," he said. "What you get is 24-hour convenience and the safety of the home."

A Trend

Despite parents' wariness of exposing their kids to online commerce, a variety of companies have recently been ramping up efforts to build businesses around young people.

America Online Inc. recently revamped its kids' section, and Walt Disney Co. Monday relaunched its family-oriented site Disney.com, expanding the kid-oriented Disney's Blast Online features. Virtual wallets are also coming into their own as a way of making shopping online more convenient. During last year's holiday shopping season such major Web powers as Yahoo! Inc. and Excite Inc. introduced wallet systems, allowing users to enter their credit-card information only once, and buy gifts from many partners.

By Arrangement with The Wall Street Journal