Boom, the mobile personal payment and banking service announced in May at Hillary Clinton’s Diaspora Forum, is now open, bringing a low-cost mobile alternative to cash remittance services. The service, which targets unbanked workers who often send money home, is launching in the U.S., Mexico, Dominican Republic, Jamaica and Haiti, where remittances can average about 20 percent of GDP across those countries.
Instead of cash wire services which can charge up to $15 to transfer money, Boom allows people to establish a bank account for $10 annually and then charges them $2 dollars each time they deposit money. After that, transferring money between accounts is free with transfers enabled by text message or with a phone call to a Boom operator. Users in the U.S. can load money at 15,000 locations including more than 6,000 7-Eleven stores. And users can pull out money from 150,000 ATMs in the U.S. and Mexico or 650,000 ATMs worldwide using a Boom debit card. There are also 23,000 merchant locations in Mexico where users can pull out money.
The service serves as a bank and mobile personal payment alternative for many migrant workers. But it can also serve as a way for parents to distribute money to their children. Bill Barhydt, CEO of m-Via, which created Boom, said almost half a trillion dollars is remitted each year internationally with fees generating $40-50 billion. He said m-via is trying to crunch down those fees, making it easier for people to distribute a lot more money more often.
“Our goal is to crunch those fees down to a 3-4 percent range rather than the 8-11 percent and provide more banking service so it’s better for consumers, safe, easier and more economical,” Barhydt told me.