By Bear State Bank

Bear State Bank Partners with Startup to Lower Money Transfer Costs

Anyone who has wired money from one country to another knows the high costs associated with fees and less-than-favorable exchange rates. And it’s a slow process, often taking up to four days to make the transfer.


Bear State Bank has partnered with LumoXchange of Little Rock, a company that plans to significantly reduce these costs while speeding up the process. LumoXchange will allow customers to compare exchange rates in countries across the world and send money online using local foreign exchange rates.

“We’re going to disrupt the $600 billion money transfer industry by creating the world’s first localized marketplace for global money transfers, “ said Maf Sonko, co-founder of LumoXchange. “And it will be faster, cheaper and more convenient.”

The company was one of 10 financial technology startups chosen to participate in the FinTech Accelerator program in collaboration with financial services giant FIS and The Venture Center in Little Rock. The 12-week program is designed to accelerate the growth of early stage financial technology ventures.

Shelly Loftin, Bear State Bank’s Chief Marketing Officer, said her bank was immediately intrigued and impressed by LumoXchange’s vision and business plan.

“The idea of helping families move funds between family members simply and seamlessly through a mobile device at a fraction of what they are used to paying was a concept we could all get behind,” Loftin said. “This concept allows us the opportunity to grow an important business line as well as help consumers. It is a win-win from our perspective.”

International currency transfers are dominated by three or four big players, among them Western Union and MoneyGram. Each year, $610 billion is sent globally through person-to-person money transfers, with $436 billion going to developing countries, according to The World Bank. Much of this is sent in small increments, say $200. Fees and exchange rates on a typical exchange can cost up to $42 in some countries. LumoXchange will offer the same service for about 40% less.

“Most transfers are to help poor families back home, so by lowering the cost, it leaves more funds to pay for school, health care and other needs. This is why we’re so passionate about this,” Sonko said.

Much of the savings will come in the form of more favorable exchange rates, something that hits home to Sonko when he sends money to family in Gambia. “It’s a little-known secret that if I take U.S. dollars to my home country of Gambia, I get a better exchange rate. It’s about trading currency, and having a middle man like Western Union leads to margins on top of margins.”

For example, on a $200 transfer from the U.S. to Gambia, the typical costs would be a $20 service fee and another $22 for the exchange rate margin. LumoXchange will be able to provide the same service for half the cost.

LumoXchange will partner with banks in host countries, and those banks will in turn bid for U.S. Dollars by offering competitive exchange rates. Customers can go to the company’s website, shop for the best rates, determine how they want the money delivered and have the funds delivered within 24 hours. “Customers crave data…look how it has upended the travel industry with services like Kayak and Airbnb. Our platform is all about one marketplace, local partners and multiple payout options,” Sonko said.

Sonko said Bear State is a critical partner to his business. “They bring the back-office transaction processing, and we bring in the customer-facing technology and go-to market strategy. So our partnership is complementary.”

Loftin agrees, calling the company “a really strong business model.” “It’s their vision and their company; we’re just helping them with the infrastructure because our values align and we believe it’s a great cause with strong leadership and a solid plan.”

LumoXchange will open this fall for exchanges to West Africa and the Philippines. They plan to expand across Southeast Asia next year and the Latin America market soon after. Learn more at or 877-629-2744.

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