Standard Bank has signed a deal with mobile operator MTN to boost its telecom offering, now called Standard Bank Connect, as part of a new strategic push for the unit.
This signals the lender’s plan to offer more telecom services, and intensifies competition in a space that Cell C has dominated for years.
The bank has announced a new mobile virtual network operator (MVNO) collaboration with MTN, which it hopes will give its customers in SA “access to the mobile operator’s extensive coverage across the country”.
Standard Bank has offered telecom services for a number of years, having introduced its MVNO offering in 2018 in partnership with Cell C. The unit has now grown to over 300,000 mobile customers.
As part of the bank’s telecommunication strategic direction, Standard Bank Mobile will now be called Standard Bank Connect, putting its naming convention in line with rival banks, and “will introduce a new set of data and voice packages.”
MVNOs are usually non-telecom businesses such as FNB, Capitec, Mr Price Mobile and Pick n Pay, which lease network infrastructure from mobile operators to sell data and voice services to customers.
For several years, the largest player was FNB. According to information communication technology research and consulting company Africa Analysis, Capitec Connect has emerged as SA’s largest MVNO, followed by FNB Connect. Both players boast more than a million SIM cards in the market, far outpacing Standard Bank’s reach.
MNVOs constitute about 2% of total mobile subscribers in SA. Cell C sees enough room in the market to have up to 10-million MVNO customers on its network. Banks, in particular, have launched mobile networks as a way to increase consumption of their digital banking services.
In April, Capitec reported in its annual results that its mobile unit is now contributing positively to its earnings. Capitec Connect had R35m in net transaction and commission income in the period, compared with a prior loss of R7m.
We are excited to ... provide our customers with a range of newly differentiated mobile plans
“We are excited to collaborate with MTN and the opportunity to provide our customers with a range of newly differentiated mobile plans,” Kartik Mistry, head of Standard Bank Connect, said.
“The transition will be gradual, where we invite our customers to join us on our pilot programme, helping us to build meaningful services together and experiencing Standard Bank on MTN’s wide network.”
“Standard Bank Connect represents a significant step forward in our commitment to providing our customers with end-to-end connectivity solutions that are tailored to offer more simplicity, more value and greater flexibility,” he said.
MTN is the operator that poses the largest threat to Cell C’s dominance in the MVNO market.
In 2023, FNB signed deals with both Cell C and MTN for its MVNO offering, having traditionally been on the former mobile provider's network. MTN also provides MVNO services to Pick n Pay.
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