Boom Financial was founded with a noble purpose, namely, to bring mobile banking to an underserved population. Their target audience, at least initially, is the immigrant consumer who has been in the United States for less than 15 years. These consumers tend to deal mostly in cash, sending money to their home countries on a monthly basis, relying on money transfer, check cashing and payday loan services.
But these services are very expensive, and many of these customers are paying large portions of their salaries to cover these fees. With the Boom Financial solution, mobile phone numbers become bank account numbers, and customers are then free to change money in real time. They can then save on check cashing costs and not have to worry about theft.
Billions of dollars are lost each year to fees and theft and the fact of the matter is, most members of this underserved population use feature phones. Therefore, the user interface is set up with an SMS foundation, though, as many members of this population move from prepaid phones to Android (News - Alert) devices, Boom is working on creating a smartphone app for these services.
Boom uses a grassroots strategy to get the word out to its target market. It deploys multiple such channels, talking to people at the mall, developing relationships in the community, going to community centers and getting locals to act as sales agents. Boom plans to have retail deployments in shopping malls and Boom areas in wireless stores in the near future. The company started in California but has plans to go nationwide soon.
The revenue model is simple. It does not rely on transaction fees, unlike check cashing or money order models, though customers do need to play a yearly membership fee and can sign up for optional debit cards.
With Boom, the customer’s bank account number is his or her mobile phone number. Customers can sign up for direct deposit or put cash in their accounts. They can send money to spouses in their home countries or get money with debit or at local stores. Right now, the services are available in the United States, Mexico and Haiti, though the company plans to deploy throughout Latin America in the coming months, then moving to Asian countries, such as the Philippines, soon.
The transactions are safe, secure and simple. And, as Boom likes to say, it’s not a service, it’s a movement. And it sounds like a pretty darn good one.
Want to learn more about the latest in communications and technology? Then be sure to attend ITEXPO West 2012, taking place Oct. 2-5, in Austin, TX. ITEXPO (News - Alert) offers an educational program to help corporate decision makers select the right IP-based voice, video, fax and unified communications solutions to improve their operations. It's also where service providers learn how to profitably roll out the services their subscribers are clamoring for – and where resellers can learn about new growth opportunities. For more information on registering for ITEXPO click here.
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Edited by Rachel Ramsey