The startup outlined a downloadable application that offers real-time purchases and transfers and can be used on any Web-enabled phone. Users can send money to or request payments from others nearly instantly, and Obopay offers a debit card that can be used in retail outlets or at ATMs.
The company charges 10 cents per transaction, paid by the sender. While the system integrates with banking systems, users are required to set up a separate Obopay account.
Obopay Chief Executive Officer Carol Realini said the company is in talks with “every carrier” in the United States about deploying the service. The company initially is targeting teens and young adults, hoping to entice them to send money to each other—at a restaurant, for instance, or a movie theater—instead of handing each other cash.
“The cell phone will do for money what the iPod did for music,” Realini said. “Instead of having cash in my wallet, I’m going to have money on my phone.”
The company is backed with $10 million in Series A financing from Redpoint Ventures, Onset Ventures and Richmond Management. Obopay’s service is set to launch in the second quarter—the company’s Web site is still password-protected—and will compete directly against PayPal’s mobile payment offering, which was announced last week.