Virgin Mobile acquires Saudi banking license
Virgin Mobile has become the latest global telco to enter the fintech space, earning a banking agent license through a strategic agreement with The Saudi Investment Bank (SAIB).
The telco is the first entity to be awarded the license in the Kingdom of Saudi Arabia, and is fully endorsed by the Saudi Arabian Monetary Agency, the kingdom’s central money and banking authority.
Virgin Mobile Saudi Consortium says it will combine its expertise with SAIB to offer ‘easy, fast and more convenient digital financial services’ for end users. A suite of new mobile financial services will be offered alongside its already robust and mature electronic international remittance facilities.
Virgin Mobile’s move into fintech has in part be spurred by rising expectations from consumers to digitalise and consolidate more of their day-to-day lives, says Erik Dudman Nielsen, Group CEO, Virgin Mobile Middle East & Africa. The move to contactless payments under the COVID-19 outbreak accelerated this trend, and opened up the doors for further innovation.
“The post-pandemic world has sharpened the customer’s digital expectations and we look forward to continuously expanding and innovating through enhanced digital capabilities that will not only meet our customer’s expectations, but also elevate Virgin Mobile’s position as a true global leader in digitalisation,” Dudman Nielsen says.
The telco will now look to expand beyond the Middle East into the North African region through a B-brand arrangement in the territory.
Telcos embrace fintech
Telecommunications firms have dominated the fintech headlines in 2021, signalling the importance and growth potential for partnerships between the sectors in the coming years, and the vanishing barriers between fintechs and other digital industries.
Virgin Mobile rival Orange earlier this month announced it will target the SME market in Europe through the acquisition of French new-bank Anytime, expanding its services and reach to include small enterprise and freelance professionals.
Our recent report on the merging of fintech and mobile telecommunications explores how telco’s could earn huge market share in the coming years.
Image courtesy: Virgin Mobile Saudi Arabia
CMA warns UK and Irish banks over bank transaction histories
Specifically, the CMA named prominent challenger bank Monzo, the Bank of Ireland, NatWest Group, and Virgin Money as not providing customers with records of their bank transactions within the maximum outlined timescale (40 days after closing the account).
Such information is crucial not only for ensuring a smooth transition from one bank to another, but also to provide a foundation for credit applications in the future.
According to the Retail Banking Market Investigation Order 2017, 95% of bank and building society customers should receive their bank transaction histories in at least 10 days.
Reputation: A bank’s greatest asset?
Of the 150,000 customers affected, Monzo was by far the main contributor - 143,000 (95.3%) - with the other three dividing the remaining 7,000.
The extent to which the magnitude of its mistake is attributable to being a digital-only bank is not clear, although it may give some customers pause for thought. With a superior customer experience being among the bank’s greatest assets, continued reputational damage is something that it cannot afford to sustain.
Although the CMA’s action in this instance has been to issue each bank a warning and order the immediate dispatch of all outstanding information, it has warned that future breaches will carry heavier consequences. Measures could include legally enforceable compliance audits on a yearly basis.
Helping customers get a better deal
Condemning the banks for negligence that could negatively impact customers’ desires to take out loans or mortgages, Adam Land, CMA Senior Director of Remedies Business and Financial Analysis, promised that his organisation would remain vigilant to similar behaviour moving forward.
“Banks must comply with all the rules – that includes providing a full transaction history promptly.
“We will be watching closely to make sure these leading names stick to their word and don’t let their customers down again. The Bank of Ireland, Monzo, Natwest Group, and Virgin Money should be in no doubt that the CMA stands ready to take further action if these failures are repeated.
Image source: gov.uk