Telecomm operator Orange is strengthening its commitment to mobile banking with a € 250 million capital increase in Orange Bank and the takeover of its bancassurance partner Groupama.
With 1.6 million customers in France and Spain, Orange Bank is now part of the top 5 neobanks in France after four years of existence. The bank claims to sign more than 40,000 new customers each month, with 1 billion euros in loans to extend by the end of the year. While the majority of neobanks have continued to deploy a free use model, more than 90% of new Orange Bank customers subscribe to a billed service.
Orange believes it has bet on a high-performance product model that plays on the convergence of telecoms and finance. In France, the average expenditure per customer who also subscribed to an Orange Bank payment facility has doubled. In addition, for 100 sales linked to mobile telephony, 35 bank sales are made. In Spain, the attrition rate of Orange customers who have subscribed to the Orange Bank offer has halved.
Although it is not yet profitable, Orange indicates that the bank is heading towards equilibrium, thanks to an increase in Net Banking Income, up 57% in H1 2021 compared to H1 2020, and a reduction of 35% of management costs per client since 2018.
The company intends to develop its portfolio of services through partnerships with fintechs. After the acquisition of the French neobank Anytime to target the professional / SME sector and the signing of a strategic partnership with Younited for credit, Orange indicates that a call for tenders is currently underway for new offers insurance.
The amount of the agreement to buy back 21.7% of Groupama’s capital has not been disclosed, although the two maintain a benchmark commercial relationship until at least 2018.
Paul de Leusse, CEO of Orange Bank said: “We would like to thank Groupama for its commitment to the success of Orange Bank. We are now accelerating our industrial and geographic development strategy for a bank by nature designed to be accessible to all. and used on the mobile phone ”