Monzo is planning to launch a UK mobile phone service in a move that will intensify competitive pressure on incumbents including VodafoneThree and BT-owned operator EE. The London-based digital bank is exploring launching its own digital sim and offering monthly contracts, according to people familiar with the matter, which would diversify its revenues away from its core banking services – Financial Times has learned.
Monzo confirmed it was in the “early stages” of developing its proposals. “When we heard from our customers that mobile contracts can be a pain point, we set out to explore how we could do this the Monzo way,” it said.
Monzo, which has 13mn UK customers, is the third fintech to turn to the mobile sector in search of a new revenue stream. Revolut and Klarna, which each have about 11mn UK customers, have also announced plans this year to offer mobile phone services in Britain and abroad.
Monzo is likely to enter the market as a mobile virtual network operator, which serves customers without building its own underlying infrastructure. MVNOs piggyback on the networks of major telecoms groups and typically then undercut them on price.
Simon Taylor analyse this and commented: „Every digital bank is becoming a Telco? Revolut and Nubank already does. At first glance this could look like just another cross sell. We’ve had packaged accounts forever. I think it’s much more interesting because:
1. Customers want and use this feature
– These new gen packaged accounts include things Gen Y and Z actually want and pay for
– it’s a revenue expansion opportunity
– It adds value to subscription bundles
2. It could be a fraud defense for SIM swaps
– Current threat: Fraudster calls your telco, pretends to be you, gets new SIM, steals your 2FA codes, empties your account.
– When your bank IS your telco they see this early
3. Building a secure ecosystem
– Banks over time could start to rebundle a lot of subscriptions as cross- sell revenue
– If this is done in an integrated experience it will get much more adoption than traditional packaged accounts.„
Banking 4.0 – „how was the experience for you”
„To be honest I think that Sinaia, your conference, is much better then Davos.”
Many more interesting quotes in the video below:
