SrPago brings Square-like payment processing to the Mexican unbanked
It’s often hard for Americans to appreciate just how limited access to financial services can be elsewhere in the world. In Mexico, for example, some 60 percent of the population (approximately 75 million people) would be considered unbanked.
Shockingly, however, smartphone penetration in many of these emerging markets is as high or higher than in the developed world. This fact presents an opportunity to address the banking problem in ways that were never possible.
Mexico City-based SrPago, which has been in the ecommerce business for four years, is now taking the banking market head on with its hybrid reloadable credit card and mobile card reader platform. After launching its mobile point of sale (mPOS) solution in Q4, the company is already the second-largest mPOS provider in Mexico with 3,000 customers and $700,000 in monthly transaction volume.
Unlike the typical 29 days that it takes Mexican citizens to open a new bank account – not to mention the burden of monthly tax filing that comes along with it – SrPago promises to allow its users to begin accepting payments and spending via credit card in just a single day. All this, without the need for a traditional bank account. The company has products that target both business and personal accounts.
SrPago, which is the first non-bank institution in Mexico to offer reloadable debit cards uses advanced EMV “chip-with-signature” Mastercards offering users strong security. Users can purchase the bundle online and at retailers including Best Buy for $50 and then pay a 3.59 percent swipe fee on all payments accepted and a $1 fee to transfer funds from their online account onto their card. Finally, users can withdraw cash from SrPago at Walmart stores and avoid the $5 ATM fees that are standard in Mexico.
Today, the opportunity is to become the default payment processor for the Mexican unbanked. Longer term, the company hopes to offer additional services like loans to its customers and ultimately to expand elsewhere across Latin America.
SrPago is deputing its technology for the first time in America today at Pando Southland conference in Nashville. The company is in the running for the $100,000 Southland Startup Competition.