At what stage of dental decay does a child need silver caps?

Simply put... When the decay is so extensive that an amalgam or composite restoration will not be adequate, a stainless steel crown is placed.
Pediatric dentistry. This is up to the treating dentist and their experience. I personally don't do silver (stainless steel crowns) because parents hate them and there is a stigma with them. If I have a child with a severely broken down tooth, I extracted the tooth and place a space maintainer when needed.