M-Via’s Boom service debuted last year with the ambitious goal of restructuring the way people send money to their home countries via mobile phones. M-Via is now getting a big endorsement from mobile operator Digicel Group, which is leading a $17 million round in the newly renamed Boom Financial.
The new funding, which includes participation from existing investors RRE Ventures and Matt.org, will help Boom scale up and try to fulfill its goal of being the primary banking brand for unbanked consumers and immigrants remitting cash overseas. Boom has now raised more than $30 million to date. The support of Digicel will provide a big boost, not just for the cash infusion but for the strategic support Digicel can provide. Digicel is the largest carrier and one of the most trusted brands in many Caribbean countries including Jamaica and Haiti, two of Boom’s markets.
Boom provides a mobile-based alternative to traditional wire payments. Users who sign-up for a $25 yearly account pay $2 every time they make a deposit but pay nothing for individual transfers. That’s in contrast to other services, which can charge by the amount of each transfer. Users can load money into their account from 15,000 of locations, including 7-Eleven stores and they authorize payments from their cell phone. Recipients can pick up cash from more than 100,000 ATMs worldwide using a Boom debit card.
Digicel said its customers in the Caribbean and Central America already receive more than $5 billion a year in cash remittances from the U.S. Now, Digicel’s airtime agents will soon be able to sell Boom services in the future and help the carrier participate in those payments. Boom can also use Digicel’s help in expanding to new markets. It currently operates in the U.S., Mexico, the Dominican Republic along with Jamaica and Haiti. But it’s looking at expanding to more countries in the Americas.
Boom will use some of the money to build up its U.S. sales teams and is preparing to open up Boom stores in big immigrant communities like east LA and Oakland. The goal, said CEO Bill Barhydt, is to educate users about the benefits of using Boom as a low cost banking resource. He said it’s not just for overseas remittances. Domestic users in the U.S. who don’t have traditional bank accounts are saving a lot of money by transferring funds via Boom. And users overall are able to transfer a lot more frequently because they’re not being charged for each transfer.
Boom isn’t sharing specific metrics so far. But it’s funding momentum suggests there’s a lot of optimism in financial services that target the unbanked and immigrants. Western Union is also trying to keep up with the times and rolling out new digital payment services such as WU Pay. While many people don’t think too often about cash remittances, it’s a huge market with half a trillion dollars transferred each year.