New iPhones for the Kids

So we got two new iPhone for the kids and sent them money to their iTunes account for buying apps. However they still cant as the phone wants thier account linked to a credit card. If they have money in thier account why is this? Is there anything that can be done other then putting a credit card in thier account? Should it work off the balance of funds in the account?

So they both have 'no payment' accounts and have been iTunes members for a few years. When I want to allow them to buy music I send them gift cards through email. This adds funds to their accounts and allows them to spend. I assumed this would work for iPones apps too. However the apps store does not seem to see the funds in thier iTunes account when trying to buy an app. Each time they try to buy an app it asks for credit card information but does not see the funds in their account already. All other things work fine... such as downloading free apps etc.
So I was wondering is there account settings that need to change or is there other ways of send funds to them for the app store.
sheepishSCOT

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