South African telecom operator Telkom moves into financial services

by   |  VIEW 1182

South African telecom operator Telkom moves into financial services

Telkom SA, the Pretoria, S. Africa-based telecommunication industry giant operating in more than 38 countries across the African continent, had expanded its offerings into a highly competitive financial services market by initiating a life insurance business what Telkom SA said would initially sell insurances for funerals.

As a matter of fact, latest move from Telkom SA to tap into the financial services market came forth as mobile operators in South Africa, the most industrialized country in the African continent, has been seeking to add more than 11 million South Africans who do not possess a bank account to receive lending offers alongside other financial services in to an unconventional financial system, eventually threatening traditional and digital financial services providers.

Aside from that, Telkom SA and other S. African mobile operators were also looking to expand their mobile payment services into online market places in order to strengthen their client bases.

Telkom SA’s latest move vindicates a strategic shift to digital distribution, says Telkom executive

Meanwhile, in a joint statement with an insurer Guardrisk which would act as the underwriter for Telkom SA’s funeral insurance service, Telkom Financial Services’ managing executive Sibusiso Ngwenya said later last week, “In recent years Telkom has made a strategic shift to digital distribution, which puts it in an ideal position to distribute insurance products using its considerable digital structure and intellectual property”.

On top of that, in a Sunday Times newspaper advertisement, Telkom SA had also claimed that it would soon begin to offer business loans and would start off a digital wallet service for the customers to purchase products and pay for several services through its Yep!

app. If truth is to be told, a rattling battle over S. Africa’s market share for unbanked consumers stepped up among the mobile operators earlier this year after the country’s largest mobile operator by subscribers MTN Group had re-launched its mobile payment app in February and had claimed to have built a platform to offer online shopping through its mobile payment app.