Monzo is set to introduce a mobile phone service, aligning with similar initiatives by fintech startups Revolut, Klarna, and N26. The UK-based challenger bank aims to offer a digital sim and monthly contracts in the UK, as reported by the Financial Times and confirmed by Monzo.
A Monzo spokesperson stated, “We heard from our customers that mobile contracts can be a pain point, so we’re exploring how to address this the Monzo way. We’re in the early development stages.” The launch timing remains undecided.
The report indicates that Monzo will operate as a mobile virtual network operator (MVNO), leveraging other operators’ networks without setting up its own infrastructure. MVNOs usually provide competitive pricing to customers.
With over 12 million customers, Monzo plans to market its mobile service to its existing users, positioning itself against established players like EE and the newly-formed VodafoneThree, alongside other fintech competitors.
Challenger banks such as Monzo are diversifying into new sectors. Besides its primary digital banking services, Monzo also provides insurance and BNPL services, and plans to expand into the EU.
In June, Klarna announced its mobile service launch in the US, with plans for the UK, Germany, and more markets. Meanwhile, N26 and Revolut have also disclosed plans to introduce mobile phone contracts and plans in various regions, including the UK and Germany.