Vodacom bets on phone insurance
Vodacom’s chief officer for financial services, Mariam Cassim, says the mobile operator is in the early stages of rolling out an “event-based insurance” in partnership with the Blue Bulls Rugby Union, which it sponsors.
Imagine a world where you arrive at a big rugby or soccer match and are able to insure your phone for the duration of the game.
Vodacom’s chief officer for financial services, Mariam Cassim, says the mobile operator is in the early stages of rolling out such a service in partnership with the Blue Bulls Rugby Union, which it sponsors.
Using Vodacom s cellphone towers at the rugby team’s base at Loftus Versfeld, subscribers who attend a match can receive a message prompting them to insure their device for the duration of the game.
This “event-based insurance” is just one of the innovations being cooked up by Cassim’s team at SA’s largest mobile operator, which has 43-million subscribers. Like other operators searching for new revenue streams outside the traditional voice business, Vodacom brought in Cassim to grow its footprint in financial services.
“Voice and data [revenue] is under pressure, that’s no secret,” she says. She sees “banks wanting to become telcos and telcos wanting to become banks” underlining the industry’s push into financial services.
Vodacom has taken a big bet on insurance, going so far as to insure all 5,500 members of the company’s workforce using its own services.
Competitors MTN and Telkom have said they will soon launch insurance products in partnership with established players such as Sanlam. However, Cassim says Vodacom’s offering is different in that it has its own insurance licence, which gives it greater flexibility and control with the products it offers.
Cassim’s unit contributed R1bn to the company’s bottom line in the past financial year. She credits part of its success to group CEO Shameel Joosub believing in new areas of business. With about 10-million people buying financial services from Vodacom, she says it has been able to make the business unit profitable in three years, quite a feat after her team inherited R88m in losses from the failed M-Pesa business.
Operated by Vodacom affiliate Safaricom, M-Pesa is the largest mobile payments platform in Africa with 36-million customers and has become the main method of payment in East Africa.
After two unsuccessful launches of M-Pesa in SA, Cassim says Vodacom is not planning to bring back the mobile money service in this country, as SA has a mature financial services industry with the majority of the population having access to formal banking. This is not the case in other parts of Africa.
Vodacom has shifted its strategy to improve the experience that consumers have interacting with established financial houses by building platforms that make it easier and more secure to transact.
EVENT-BASED COVER IS ONE OF THE NEW SERVICES BEING ROLLED OUT BY THE MOBILE OPERATOR
In partnership with MasterCard, the company launched VodaPay MasterPass, a payments app similar to Samsung Pay and Apple Pay where users can keep a virtual version of their normal bank cards on the app and pay in-store by scanning a QR code. The app, available for users on Android and Apple devices, incorporates digital payment platforms Zapper and SnapScan.
The company tested the app internally before releasing it to the public earlier in September, said Cassim. The operator plans to open the platform to nonVodacom users, allowing users to buy airtime for other networks, among other services.