As the rise of e-commerce and mobile payments continues to threaten the champion status of cash, the market has threatened to leave behind the un- and under-banked population. ALTPAY wants to scoop up those consumers with a new mobile payment application that can be used by shoppers, even if they don’t have a bank account or credit card.
Florida-based ALTPAY has launched an app that allows users to pay at stores that accept the service simply by inputting the purchase amount and store location. A unique code is then generated and given to an ALTPAY registered teller at that store to complete the purchase. Consumers can top up their ALTPAY account not only by bank account and credit card information, but also with cash at ALTPAY-registered tellers.
According to statistics, the number of American households classified as un- or under-banked is surprisingly high: FDIC numbers show that in 2013, just under 8 percent of households do not use banking services, while an additional 20 percent categorized as under-banked, meaning individuals may have a bank account but use non-banking financial services.
Together, that population adds up to 34.4 million households that ALTPAY can tap into to facilitate everyday purchases.
But ALTPAY isn’t just appealing to the un or under-banked, as the application offers coupons and promotions and other incentives for its users. And for merchants, the company says, ALTPAY can be seamlessly integrated into existing mobile applications and POS infrastructure, as well as loyalty systems, or can be used as a standalone payment processing mechanism. Combined with brand customization and consumer habit tracking, ALTPAY offers convenience to retailers, all for a flat 1 percent transaction fee.
The company, which is set to launch operations in Latin America next year, announced Monday (Dec. 1) that it had received a $1 million equity investment from two investors. The startup is appealing to investors, ALTPAY managing partner Victor Cook says, because the app and its operations are already functioning. “ALTPAY is one of two first-to-market companies that are already doing business, have clients and revenue,” he said.