South Africa’s First National Bank (FNB) is in the process of launching a mobile bank account that can be used on any phone, targeting the unbanked population with their new offering.
The South African bank revealed that the mobile bank account, which will officially launch in June, allows consumers to use either a feature phone or smartphone to open a bank account without the need to visit a branch, according to Businesstech.
FNB – along with other African banks – are now forced to compete with innovative African mobile tech startups and fintech firms who are taking their customers.
The startups, such as Flutterwave and Pesachoice, are providing inclusivity previously unavailable to unbanked members of the population.
While many banks are seeing an opportunity to partner with fintech startups in order to innovate and not fall behind, FNB seems to be competing directly with these new players in the African market, with the aim of leveraging their massive national infrastructure to attract and cater for consumers.
In addition to competition from fintech startups, the South African market will see the entry of two new digital-only banks, with Tyme Digital and Bank Zero both scheduled to launch this year. FNB’s timing is no coincidence, as they look to make a move before digital-only banks make theirs.
The new product, called eWallet eXtra, allows a person to open their account within minutes via their mobile without any paperwork required.
All the user needs is a valid South African identity document and the unique number related to that document, while they have to be over the age of 16 to open the account.
In an effort to target the unbanked and underbanked, the account is functional and fees are reasonable, while those who open an account are only charged once the user begins to transact through the account.
Gugu Zikhali, FNB’s head of transaction products for the mass market, explained the ease with which consumers will be able to open their mobile bank accounts.
“If you are above the age of 16 and own a cellphone, you’ll be able to get a mobile bank account with a unique account number in less than three minutes, and you don’t need a bank card to transact,” said Zikhali, according to Techcentral.
The bank’s original eWallet product was designed as a remittance service, but FNB soon realized that many customers made use of the product as a bank account of sorts, so they further developed the product into a mobile bank account offering which would cater for the needs of a large unbanked population.
The bank revealed that their potential market for this product is about 11 million people, with the impressive mobile penetration rate in South Africa providing FNB with the ideal means of connecting with a larger user base.
FNB has built a global reputation for innovation with regards to their products and services. Last year it was named as Africa’s most innovative bank at the 2017 African FinTech Awards for the second consecutive year, according to IOL.
The bank is no stranger to innovation awards on a regional and global scale, as FNB was voted the world’s most innovative bank in 2012 at the Financial Global Banking Innovation Awards held in Washington DC, according to Businesstech.
FNB also recently made the decision to zero-rate their mobile app on all South African networks, meaning that users can access the mobile app without using their data, enjoying free app services while on all networks including Vodacom, MTN and Cell C.
