The concept may sound strange to Americans, but in some regions around the world cellular telephones are used almost exclusively on pre-paid plans, where users ‘charge’ up their phones sporadically with credit that can be used to place calls and send text messages. Unfortunately many people, particularly in poorer areas, find their credits dwindle toward zero with alarming frequency. Enter Aryty, a new startup that’s looking to help mobile phone users in India and the Phillipines by giving them a highly efficient way to receive money from their loved ones abroad.
Aryty CEO Nils Johnson says that it is quite common for families in America who have loved ones in the Philippines or India to send money on a fairly regular basis as a reminder that they’re thinking of them. But standard wire transfers, especially for small amounts of money, tend to be highly inefficient because of the way fees are structured — you might pay in excess of $10 in fees for a wire transfer of only $20.
In contrast, Aryty has no fees. Families can send money directly into the cellular accounts of their loved ones without losing anything in the process, which makes it more appealing for these ‘thinking of you’ transfers. To initiate a transfer, you simply enter your credit card information, and the credit is instantly added to the cellular account of your loved one abroad (they also receive a SMS message alerting them to the addition).
Generally speaking, Aryty users will send relatively small amounts of credit on a regular basis — say, once a month or every two weeks. The reason for the fairly small amounts is that most carriers in India and the Philippines don’t allow for ‘roll-over’ credit, which means any excess amount left at the end of the month will expire. Fortunately, Aryty also offers a scheduling feature that lets you send money as often as you’d like without having to remember.
Aryty has forged deals with major carriers in the Phillipines, and is now expanding into India, where it expects to have support for around 98% of the market by the end of the year. And while Aryty doesn’t charge any fees, it can still make money — carriers sell the company minutes at a discount, which it can then resell at the standard rate. Carriers like Aryty because it lowers user churn (users don’t want to switch carriers after they’ve established accounts that their family members are depositing money into).