Revolut is launching a travel eSIM plan in the UK, a rare move for a financial services company.
Revolut
British financial technology company Revolut is launching phone plans in the UK, the company told CNBC exclusively. This makes it the first financial services company in the country to offer telecommunications tariffs – and one of the first in the world.
The unicorn of digital banking and payments announced that starting this week it will offer eSIMs – SIM cards that can be stored virtually on the device instead of in physical form. The plans will be rolled out to users in the coming days.
Customers who use Revolut’s basic app experience without a subscription can get a standard eSIM plan, which gives them access to their Revolut app so they can charge their phone when they need it. For example, if a Revolut user arrives at an airport and runs out of data with their current SIM provider, they can continue to access features in their Revolut app for free and top up their data as usual.
Revolut customers on the company’s Premium Ultra package for £55 ($69.47) per month get 3GB of data for worldwide use, with a rolling update every month. This means they don’t have to worry about unexpected roaming charges when entering another country.
The cost of using mobile data abroad has risen for Brits in recent years. Several mobile phone providers, including BT, Vodafone and Three, have reintroduced roaming charges since Britain left the European Union. Until now, Brits have been able to travel across the EU without incurring roaming charges. Most mobile phone providers now do not include free data volume in non-EU countries in their standard tariffs.
Revolut users without an Ultra subscription can get an introductory offer of 100MB of free data if they apply before May 1st. The offer is valid for seven days. After that, they will need to upgrade to Ultra if they want to continue using the eSIM.
Revolut has teamed up with UK mobile network operator 1Global, formerly known as Truphone, to launch its eSIM.
Tara Massoudi, general manager of premium products at Revolut, said that the decision for Revolut to introduce eSIMs was to transform the company into an all-encompassing “super app” with services that include bank accounts, currency exchange, insurance, travel bookings and Airports include lounge passes.
“Our goal is to be the financial super app,” Massoudi told CNBC. “It’s really heading in that direction.”
“Travel is a huge added value that we have always had, and it is still very important to our users,” Massoudi added. “That’s why it’s important that we continue to innovate in this area.”
The introduction of telephone tariffs is a rare step for a financial services company. Many challenger banks have bundled new services into their apps to give consumers a better reason to use them instead of alternatives. The goal is to gain a stronger customer base in the long term.
This is pretty important in the case of Revolut. The company, which was valued at $33 billion in 2022, is trying to attract a more loyal user base and expand its offering of paid subscriptions to diversify revenue.
This requires customers who are more likely to use it as a permanent banking provider for all financial needs and not just as an optional, inexpensive travel account for stays abroad.
Hermann Frank, CEO of tech startup Gigs, which helps companies set up and sell their own eSIM phone and data plans, said Revolut’s move could prove lucrative for the company in the long run.
“This move represents an easy opportunity for Revolut to develop a lucrative new revenue stream and could play a critical role in the company’s long-term viability,” Frank told CNBC via email.
“By enriching their offering with branded phone plans, neobanks like Revolut can combine two essential services into a single app, simplifying the user experience and increasing engagement even further.”
Retail spending on travel connectivity services, including roaming packages and travel SIMs, is expected to exceed $30 billion by 2028, according to roaming and connectivity market research and advisory firm Kaleido Intelligence.
“We expect many more banks to introduce phone plans and travel offers in the next 18 months,” Frank added.
Revolut is not the first fintech company to launch an eSIM offering. Indian credit card startup Zolve, which helps immigrants set up banking before arriving in the U.S., has been offering phone plans tied to physical SIMs and eSIMs since August.
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2024-02-12 07:18:15
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