Orange Bank lands in a market very disputed


Stéphane Richard, CEO Orange, presenting the offer Orange Bank in April 2017.
© AFP/ ERIC PIERMONT

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First mentioned for the beginning of 2017, and then announced for July, the launch of Orange Bank takes place this Thursday, November 2, after several months of preparation. The operator Orange became the first telecom giant in France to attempt the adventure on a sector that is already fervently played by the institutions of the traditional and new actors in technology. “Among the actors of the neo-banks, it is the one that has the potential of users the most important “, down to the Agence France-Presse Ratana Lyvong, specialist of the financial sector at audit firm RSM.

Orange will be offering a series of services intended to facilitate the life of the customer at a low price : opening an account simplified, card payment free, consultation of the operations in real-time. Orange has reasons not to rush, the group will bet € 500 million over the next ten years with the stated goal of reaching 2 million banking customers. “The threshold of profitability is (…) best five years,” warns Alice Poizat, a specialist financial services consulting firm Kea & Partners.

A very competitive field

The market promises to be played. Great rival of Orange on the telecommunications sector, and Altice (SFR) announced in July its own mobile banking by 2019. With regard to traditional banks, the hesitations of Orange have left the time to take a position. The behemoth BNP Paribas has bought the beginning of 2017 the mobile bank Account-Nickel, while already holding the online bank, Hello Bank and a share of the C-zam, account operated by the retail giant Carrefour. Credit mutuel-CM11 announced an offer that combine bank account and phone plan. And it is an open secret, relayed by the press, that Crédit agricole expects a similar proposal in the next few weeks. The area is also rich in young shoots ambitious. If most of the historical actors of the online banks have been redeemed, Boursorama by Société générale, Fortuneo by Crédit mutuel Arkéa, a new generation of “fintechs” appeared on the mobile bank, as the German N26.

“We can’t see very well what the offer is going to be original” on the side of Orange, asks Martine Leconte, specialist banks in RSM. The experts stress that it is by working a niche audience as new actors have been able to get a place, as N26 or Nickel, and non-building directly as an Orange on a mass market. “The highlight for Orange Bank, it is to present itself as a bank of full-year,” notes Alice Poizat, highlighting the ” willingness to dare to call bank without sacrificing its identity “.

Orange relies on ” a database of clients unmatched in France ”

But analysts recognize that the nature of the Orange is also its strength and its specificity : a giant with 25 million mobile customers, instead of “a fintech” to a few dozen employees. “They have a huge strike force, so it could be the advantage of capturing the market of the other,” says Martine Leconte. With crucial asset, such as a network provided by agencies and physical “a customer database, unsurpassed in France,” says Alice Poizat. “The customer databases of telephone operators are among the best qualified in the market, where banks struggle to have things of good quality. “

Another advantage is that Orange, its know-how in the telecom sector as the use of banking services is increasingly via mobile phones. “The link between a bank 100 % digital, and leverage on its network (…), what are the first to try to do that,” notes Alice Poizat. She cites this position as one of the great challenges of the Orange Bank, and its ability to “capture very quickly lot of customers” to compensate for the free partial services. In fact, the various experts remain cautious on the profitability of Orange Bank. For the analysts of RSM, it is on the credit that the serious things begin, the operator promising already real estate loans and consumption. “The DG is still André Coisne, someone who was the former boss of ING Direct and of Bforbank “, two online banks historic, ” concludes Yann Hadjadj, technology specialist at recruitment firm Heidrick and Struggles. “It is someone who knows very well these ecosystems. “

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