FNB Connect CEO Sashin Sookroo.
Thirty percent of mobile virtual network operator (MVNO) FNB Connect’s digital sales are now eSIMs, as adoption and usage become more mainstream.
This, after introducing the virtual SIM card in November 2024, to circumvent bill shock for customers after they activate roaming overseas.
FNB Connect CEO Sashin Sookroo told ITWeb the eSIM segment is expanding rapidly, with local eSIM growth at 144% and global eSIM growth reaching 717% year-on-year.
The service now covers over 240 countries and regions, across 800 networks, he noted.
The innovation in roaming also allows customers to pre-buy global travel bundles up to 60 days in advance, said Sookroo. “A customer is able install an eSIM directly from the banking app onto their phone, and we’re seeing that customers are using it. The growth has been phenomenal across our eSIM, and it’s still a very important growth lever for us.
“We suspect as more eSIM-enabled phones come into the market and…we make eSIM-enabled phones more readily available, we expect this to even grow further.”
FNB Connect became the first bank-owned MVNO to launch eSIM support for its retail and commercial customers.
eSIMs are not new to the South African market, with local operators MTN, Telkom and Vodacom, and MVNO player Melon Mobile offering eSIM support and solutions.
These virtual SIM cards have been touted as a game-changer in phone connectivity, with experts saying this will play an important role in accelerating the local MVNO market.
Furthermore, eSIMs are seen as a more environmentally-friendly alternative given the environmental challenges caused by physical SIM cards.
FNB Connect marked a decade last year June, signalling growing appetite for products and services offered by MVNO players.
Itis the big-four bank’s mobile connectivity business, offering SIM cards, voice, data, devices and prepaid services.FNB customers choose from a range of contract and prepaid packages, smartphones and devices.
The MVNO’s device proposition has expanded beyond smartphones, smart devices and home connectivity, to solar solutions for the home and business, as well as water harvesting and backup solutions.
FNB Connect counts just over one million subscribers, following its debut in 2015.
The customer growth mirrors progress across multiple business segments within FNB Connect, according to Sookroo, with sales in the digital services business growing by 19.2%, for the year ended 30 June.
Similarly, the devices business saw sales volumes increase by 18.4%, with cash devices more than doubling.
“We enable customers to recharge FNB Connect airtime at certain retail points. So, over 170 000 retail points, and that growth in customers recharging on non-banked channels increased by 247%. It’s been a good year all round, in all lines of business for us.”
In terms of the MVNO’s devices portfolio, sales grew double digits, despite global economic challenges like chip shortages and supply chain disruptions, he stated.
He added that there are over 160 devices selling under R5 000, and the business has also launched a service for refurbished phones.
“For customers who like premium brands like the iPhone, they can get an iPhone for under R5 000. This is also linked to our big eSIM strategy, where you can connect instantly. So, if you see the value and you see a great deal, you can switch to connect instantly.”
According to Sookroo, FNB Connect remains an integral part of the bank’s overall strategy.
“We’re realising more that connectivity is becoming integral in customers’ lives, and our role in Connect is to ensure we connect customers and make sure they are connected not only to banking, but participating in all the other opportunities that connectivity offers.
“It’s an integral part of the value we offer as a bank, and it’s going to become even more so as we see the trends tipping more in connectivity’s favour.”
A report by local market analyst firm BMIT states the collective market share of MVNOs will account for 10% to 12% of mobile subscribers in five years.
As a result, there has been interesting interplay between the services that banks, telcos, retail and JSE-listed tech firms are offering local consumers.
Sookroo commented that he welcomes the accelerated activity in the MVNO space, saying: “We’re very glad that there’s a lot more competition, whether it’s telcos or even banking, because it ensures customers not only see the value they get but can also vote with their wallets.”