FNB Diversifies Into Mobile Network Business, Becomes A Telco
In an effort to win new customers and keep existing ones, First National Bank (FNB) will be become the first bank in South Africa to launch a mobile network, News24Wire reports.
FNB expects to start selling SIM cards June 15, becoming a mobile virtual network operator that will roam on Cell C infrastructure.
Many people are excited about FNB’s entrance into the mobile market, but express concerns about its mobile partner Cell C’s network quality, MyBroadband reported.
Ravesh Ramlakan, CEO of FNB Connect, downplayed concerns about Cell C’s network quality.
“We have been on a staff pilot from November and currently have a few thousand staff on the pilot,” Ramlakan said. “The response has been positive.”
Ramlakan told MyBroadband that FNB had spoken to all mobile network service providers, and Cell C best served their needs.
“FNB was looking for a partner that was willing to innovate and change the space in their environment, in the same way that FNB has innovated and changed the banking space,” Ramlakan said. “We also required a partner that was willing to change their model to accommodate this kind of partnership. This is why FNB decided to partner with Cell C.”
For years FNB has been leading the charge for South Africans to move to digital banking, effectively discouraging the use of cash for transactions, according to a report in BusinessTech. The bank recently raised fees on withdrawals effective July 1 that will make it the most expensive bank in South Africa for entry-level banking accounts with balances of more than 500 rand.
Fin24 technology editor Gareth van Zyl tested FNB’s mobile network for 24 hours on a Samsung dual-SIM smartphone to see how it compares in coverage to other networks such as MTN.
On the upside, he said it put other cellphone providers to shame when it comes to controlling your account online. He also liked that FNB’s online banking portal lets you see what you’re spending on your SIM cards.
The downside: you have to be an FNB customer to access it. Another potential problem that bothered him, he said, is what if Cell C is sold? What will happen to prices and contracts?
Mobile phones will be sold separately from service to give FNB customers a choice in how quickly they pay off their devices, Ramlakan told Fin24.
“I’m going to tell our customers: Thank you for banking with us, here’s more. I’m going to ask other customers who don’t bank with us, why aren’t you with us?” Ramlakan said. “It’s retention No. 1 — keep our existing customers happy — and No. 2 is to win more customers.”