Boom Financial aims to solve a real world problem. The mobile banking industry is a space cluttered with false hopes and poor executions, so a real solution is a rare sight. The company “aimed to tackle that helpless feeling of moving to another country,” says Bill Barhydt CEO of Boom, adding their service is “giving a lot of control back to the consumers.” Boom just closed a $17 million funding round led by Digicel Group, a leading mobile provider in the Americas and Pacific. Their existing investors, RRE and MATT.org also joined in. As well, the company was founded in 2008 and just renamed itself Boom from m-Via.
Boom aids foreign workers, a group that sends over $50 billion “home” to family and friends. Specifically, Boom is for immigrants that may currently use, in the words of Bill, “those shady check cashing services” and payday loans – companies that leech off foreign workers and international transactions by charging excessive fees to conduct simple bank transfers. Boom eliminates the need for those services, offering low-cost, bank-grade international transactions for those without an account at a bricks-and-mortar bank (strangely, those still exist).
Boom “unbanks” customers by creating digital mobile accounts linked to each user’s mobile phone number. This frees up transfers and deposits to be made between accounts through SMS, with no costly processing through a bank.
Where Boom thrives is at addressing a real world issue with advanced technology succinctly. What Boom actually does is complex behind the scenes, but incredibly simple for the end user allowing transactions between just about any phone that can send and receive SMS messages.
For example, when someone in San Francisco needs to transfer money to a friend or family member in Jamaica, all they need to do is send an text message with the account and transfer details. From there, Boom takes the text message, accesses the user’s account and deposits it in the bank account tied to the phone number on the receiving end, and the cash is there. If no bank account is associated with the number, Boom automatically creates an account for free and deposits the sum. Shortly after, a customer service agent contacts the new user and walks them through setting up their account as well as arranges for a debit card to be sent in the mail, if the customer wants. Otherwise the amount can just be withdrawn. From there, customers can withdraw money from ATMs using the debit card through the mastercard network or directly from their phones in stores using the Boom network.
Bill found that while putting the effort into studying the regulations,“It just shows you how inefficient the existing system is.” Both in simply transferring the money the old way, and dealing with regulations. “I spend 25% of my day just dealing with making sure the company is regulation compliant,” says Bill.
As for the cost, it’s leagues cheaper than using a bank or remittance service. Those cheaper rates are paying off, they’ve seen that users are actually accessing their service more than they would their normal bank. Customers are “using the service how they want, not based on how they’re charged,” says Bill.
They hope to expand first throughout the Americas (notice their well-placed backer) and then move into emerging markets thereafter, where cash is still key to the economy, yet everyone owns a cellphone.