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FNB Connect sees strong growth

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FNB CEO Jacques Celliers.
FNB CEO Jacques Celliers.

FNB Connect now has over 670 000 active users on its network, growing by 29% over the last 18 months.

FNB Connect launched as a mobile virtual network operator (MVNO) in June 2015, making First National Bank (FNB) the first bank in the country to establish a mobile offering.

In less than six months, it had racked up 100 000 customers, and before it celebrated its first birthday, this had doubled to 200 000. Since then, the growth has continued. By June 2016, it had 400 000 customers and this grew to over 520 000 as of 30 June 2017.

The bank confirmed with ITWeb that as of 31 December 2018, it had a subscriber base of 670 000, with the MVNO only in existence for three-and-a-half years.

"It's going very well," FNB CEO Jacques Celliers told ITWeb in an interview. "We think we should have had a little bit more scale by now, but I think it's in a very good trajectory."

Celliers believes the growth has been very positive but says all of the bank's value propositions "are not meant to compete with the market".

"For example, with eBucks we don't compete with loyalty schemes, we use our loyalty scheme to compete against the banks. So the same for FNB Connect: we don't compete with the telcos we compete with banks because these SIM cards, telecommunications solutions and value propositions are built to retain more banking relationships," he explains.

"Once you have the customers banking and mobile then it's very hard to break it apart. The convenience of being able to use the banking platform for your SIM cards becomes a very crucial way in which you're living. So all of the stuff we are adding to the platform, even things like renewing your car licence and buying a house on the app, all of these are reasons to come back," he adds.

"We are really trying to embed them deeper into our banking relationship so that it's like eBucks, it's not something that you can actually stand alone and compare elsewhere. We want to see it bundled with your banking; that would be awesome for us, to get to a stage where when you get a bank account, you automatically get a telco with it. That is where we are ultimately aiming for."

Rival Standard Bank launched its own MVNO, SB Mobile, in November last year but when asked if FNB Connect has felt any impact from the competition, Celliers told ITWeb: "No, not at all."

No games

FNB has implemented the Independent Communications Authority of South Africa's (ICASA's) End-user and Subscriber Service Charter Amendment Regulations which became effective at the beginning of March.

The new regulations put an end to automatic out-of-bundle (OOB) billing and allow users to opt-in or opt-out of OOB data charges to minimise bill shock. The regulations also allow users to rollover unused data before the expiry date and transfer data to users on the same network. Operators also need to send depletion notifications to customers when data, voice or SMS bundles reach 50%, 80% and 100% depletion.

At the last minute, ICASA excluded MVNOs and resellers from the regulations so FNB did not technically have to comply but when asked why it did, Celliers replied: "We see these things through, we don't play games."

Xhead = Next for nav>>

FNB's nav>> platform within the FNB app is also growing and users can now buy or sell a home on the app, renew their car licence, and track and manage their financial health.

When asked which nav>> innovations have been most successful, Celliers said there are a few focus areas.

"We have a pipeline that will keep us busy for 20 years with all of the ideas we have. But there are basically three categories that we try to innovate to. They touch the things that a normal person in the street would be spending their money on: typically that is your accommodation, so that is why we have nav>> home; your transport, so we have nav>> car; and then the third one is children or family so internally we call it nav>> kids. Those are the three themes that most of our innovations are into."

He says the nav>> applet focuses on things that are big pain points for consumers, like car licence disc renewal and valuations of property and vehicles.

"What we're doing at the moment is we're trying to build great databases with all of these interactions. So if we help with the licence disc renewal of the vehicle then we have a good data point to understand the vehicle. If we know where someone works and lives, we could then predict, based on usage of the vehicle, when people will be wanting to sell it," he says.

"So if you walked into a dealership to buy a car and just by taking a photo of the licence disk you could really know that ownership rather than trusting the dealerships to tell you the ownership. All of this is what we are hopefully going to be able to build up to.

"In our client base of eight million people, we know not everyone has a car, but modes of transport are a very important way for us to be looking for financing opportunities. It's those things that we feel the platforms in the future would be distinguishing themselves on.

He says the next innovation for nav>> would be around credibility of suppliers.

"For example, if you have to put in the swimming pool or redo your kitchen, many people get taken with a R20 000 deposit and then the guy doesn't pitch up. So, we can validate the legitimacy of a supplier, especially if they are FNB business banking based. If you want to find a plumber in your area, you can look at which are the most trusted plumbers in the Parkhurst area that bank with FNB. Customers can get trusted advice out of it, to help people live and navigate life. We think these are the things which will distinguish one banking platform from the other," he concludes.

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