The population of India is 1.2BN with 800MM people living under the poverty line. Poverty has not stopped a staggering 80% of India's population from owning a cell phone. As of July 2012, there are 929MM active mobile phone subscribers. Most subscribers use a post pay model, where users visit corner markets to 'top-up' cell phones on a regular basis.
Eko is a company that leverages existing retail shops, mobile connectivity, and banking infrastructure to extend financial services to the poor. Customers can go to an Eko certified retailer to open savings accounts, make deposits/withdrawals, send money to any part of India, and receive money from any part of the world. All transactions are made through mobile phones via text messaging and USSD technology, which enables basic feature phones to make a transaction.
The business model is simple: The mobile connectivity partner charges the end user a fee of roughly 2% per transaction. The connectivity partner provides Eko with a revenue share percentage of ~0.7% which is used to cover costs including payment to the retailer.
To date, Eko has processed $30MM in transactions with just 1600 locations. Most transactions are sub INR 10,000. Eko has aggressive goals for 2013 to increase the number of retail outlets - a huge win for individuals who otherwise wouldn't have access to financial services.
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