Startup Aims To Help U.S. Immigrants Navigate The Banking System
More than 1 million immigrants arrive in the U.S. every year, according to the Pew Research Center. For most of them, no matter where they come from, navigating the unfamiliar and complex financial system is a particularly onerous task. That includes anything from establishing a credit score to opening a bank account. A growing number of fintech and migrant tech startups are trying to address those issues.
Two-year-old MAJORITY is one. For a $5 monthly fee, the digital banking subscription service provides subscribers a bank account with no overdraft fees or minimums, a Visa prepaid card and low-cost international phone calls. Plus customers can make unlimited, instant international transfers. Through banking partner Sutton Bank, customers have access to 55,000 ATMs.
“It doesn’t matter where you’re from. If you’re an immigrant, you share a set of values. You’re ambitious. You’re hard-working. And you want a better life,” says CEO and founder Magnus Larsson. “That’s what we’re building with our brand.”
It also addresses the potential for cultural roadblocks and confusion through advisors drawn from different communities, who help customers. And through its Migrant Handbook, the app offers information about everything from Social Security to housing. Customers also can tap a community of fellow immigrants via the platform. “It’s about trust,” says Larsson.
After running pilots in Houston and Miami, service was made available throughout the U.S. in June. In its first three months, the app attracted 20,000 registered users, with 5,000 paying subscribers. More recent data isn’t available.
Tackling a Nightmare
About 20 years ago, Larsson spent time in the U.S. as a student and then a teacher. That’s when he experienced how difficult it was for immigrants to establish a bank account. Providing the right documentation was a nightmare, for example, as was simply understanding the many differences between banking in the U.S. and home.
It got him thinking about how hard the process must be for other immigrants from different places. “I come from Sweden, a rich country. I speak fairly good English. And still I faced a lot of issues,” he says. “I couldn’t imagine the problems people from other countries faced.” That led to the idea for MAJORITY. “I saw the need to build something that solves the problems you have when you’re not from the country you’re trying to succeed in,” he says.
He and his colleagues launched MAJORITY in 2019, running pilots targeting Nigerian Americans in Houston and Cuban Americans in Miami. In June, they rolled the service out nation-wide.
To simplify the banking process, customers can set up accounts with just an ID and an Individual Taxpayer Identification Number or a Social Security number.
But Larsson also realized immigrants needed help navigating the system and that guidance had to come from community members who understood their particular cultures and the challenges they faced.
So he introduced a system of about 100 advisors, some employed full time, others working as contractors. They’re stationed at Meetup spaces in Houston and Miami, as well as other locations in Dallas, Ft. Worth, San Antonio and Austin in Texas, Hialeah, Miami Gardens and Tampa in Florida and in Atlanta. Also, mobile users can access customer service helpers through the app. Plus, the company plans to establish centers in New York, Chicago, Los Angeles and Washington. D.C.
In 2015, Larsson became CEO of Swedish technology firm Rebtel, which allows people to make international phone calls at a low-cost. Initial funding for MAJORITY came from Rebtel’s founders and investors. In May, MAJORITY also raised $19 million in seed funding,