Thursday, April 18, 2019

T-Mobile US Becomes a Bank

T-Mobile US is getting into the mobile banking business. More important, perhaps, it is becoming a bank. That move, as much as anything beyond its earlier move into the video subscription business, illustrates the moves T-Mobile US and other connectivity providers feel they must make to generate revenue growth as the mobile business reaches saturation.

Canadian telecom firm Rogers has been a bank for some years, though it does not appear to generate appreciable revenue. In structuring its offers, T-Mobile US might not actually believe th move will generate much revenue, either. But the offers could increase new subscribers and contribute to lower account churn.

T-Mobile MONEY is available nationwide. The no-fee, interest-earning, mobile-first checking account is smartphone based and apparently available to non-T-Mobile US customers.

Under some circumstances, T-Mobile will pay four percent interest on the first $3,000 of deposits, with one percent on every dollar over $3,000, so long as the customer is a current T-Mobile US postpaid mobile user and agrees to deposit at least $200 monthly into the account.



To be sure, there are many aspects to mobile banking, ranging from using a mobile banking app to mobile payment. T-Mobile has chosen to become an actual banking entity. Verizon and AT&T once tried to become mobile payment platforms, but have abandoned the effort.

T-Mobile US is betting that banking is a very sticky feature, and that its way-above-market interest rates will be doubly attractive.

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