Living and Giving

Barared\’s Bank in a Telephone Booth

Share This Post

Dear Living and Giving Readers:

What a powerful way to help small shopowners succeed:  \”A Bank in a Telephone Booth.\”   Barared\’s \”telephone booth banks\” in Mexico are helping small businesses get access to needed bank accounts and bill paying. 

It\’s something we take for granted: Having a simple, accessible banking system.  In this small town of Mexico, you can travel hours to find a bank — which closes at 4 pm.   Barared takes a stab at providing this local, low-cost banking access to shopowners. There are IPADS in the telephone booth that help facilitate transactions. They don\’t have to travel, and it isn\’t as expensive.

The other great aspect is that shopowners must contribute a small investment to start a bank in a telephone booth (tienditas).   With that investment, they get commissions on all transactions. With shopowner commissions estimated between $250-$400 per month, that\’s about 1/4 of a Mexican\’s average income.

I love that people are contributing to their own banking system — and getting compensated for it.  Very exciting to see!   Below is  a summary of the article \”Corner-store booths with iPads as interface\”  from the Christian Science Monitor.

Progress Across Our World!


How an iPad in a corner store can spell success in Mexico

By Lauren Villagran (CSM Weekly, May 28, 2013)

On the outskirts of Mexico City, the cinder block houses of Chimalhuacán crowd a hillside. It’s a city beyond a city, made up of nearly 1 million residents including surrounding areas, yet it lacks many of services and stores one might expect of a city ­– including banks.

Just two bank branches serve this densely populated suburb in Mexico state.  Without easily accessible banks or ATMs, many residents lack access to basic financial services and have trouble paying their monthly bills due to the inconvenience of long lines and the cost of transportation to and from the few locations available.  More than half of Mexican municipalities still lack even one bank branch, according to the World Bank. 

Barared offers banking and bill-paying services in booths set up in small corner stores. A Barared facility looks like a telephone booth.  A sign outside advertises the ease with which customers can pay light and gas bills.  Inside, an iPad console offers a range of services such as account deposits in two participating banks, bill payments, and, soon, remittances.

 A Personal Story 

Clara Maria Vazquez arrived at the pharmacy window with a payment toward a $2,000 microloan she used to open a hair salon in the neighborhood. Ms. Vazquez says she has to make a payment every eight days. “Here they charge us a little but it’s much closer to me,” she says.

Commissions vary on services but they amount to the equivalent of a few dimes on the dollar – a fraction of what people pay in transportation costs to the two bank branches or telephone company. The other plus, users say, is the convenience: Banks close at 4 p.m. in Mexico, while tienditas stay open late.

Each Barared booth costs about $2,800, including the equipment and installation; the company has installed 130 so far and aims to reach 1,400 this year across Mexico state. The shop owner contributes about 10 percent of the upfront cost, or about $280. In turn, the shop owners can expect to earn between $250 and $450 monthly in commissions on transactions.


Lauren Villagran is a freelance correspondent in Mexico City for The Christian Science Monitor and other publications. Previously, she worked for the Associated Press in New York. She holds a degree from the Medill School of Journalism at Northwestern University.