Fintechs banks offer eSIMs value

Their pain points are obvious as well. Finding a local SIM card in every nation and having to keep it safe – and in service – so you can use it the next time is laborious. Being hit with international roaming charges is a nightmare. Connectivity is a given when you’re at home – why can’t it be the same when you’re away?

Fintechs such as N26 and Revolut are now offering eSIM (embedded SIM) services that work in specific countries, or worldwide, to their customers from within their apps. Capable of being remotely provisioned, eSIMs have been adopted by leading manufacturers and are now increasingly common in mobile phones and wearables, such as smart watches. These eSIM services typically offer bandwidth and usage at cheaper rates than established mobile network operators (MNOs). 

Their ease of use and portability has fueled enthusiasm among travelers. One market intelligence study reports that one in three international travelers will be using eSIMs as their primary connectivity aid by the end of this decade.² 

Aside from sidestepping the high cost of data roaming through traditional MNOs, eSIM services offer the following advantages: 

• Ease of activation. Provided your device is eSIM-compatible, you can download a profile anywhere, and provision it almost instantly.
• Ease of use. You can manage it yourself, selecting the plan that best suits your needs, and you can cancel or upgrade when you want.
• Uptime across networks globally is approaching 100%.
• Flexibility. You can use both your existing mobile contact and the travel eSIM, in parallel.

No keeping track of old physical SIM cards from multiple countries. No hunting for public Wi-Fi. You don’t even have to change your phone number. 

For a digitally savvy consumer with a global lifestyle, the attraction is obvious. No wonder frequent travelers are signing up. 

Growth advantages for fintechs

A fintech’s value proposition is usually thought to be in managing money. However, as the fintech landscape grows more crowded, clear differentiation is key. Everyone is offering the same financial services, while the cost of acquiring new customers continues to go up. To be perceived as offering integrated services that go beyond traditional banking is crucial for sustained – and sustainable – growth.

Branching into connectivity is a natural progression for fintechs, a further step to being seen as “partners” in their customers’ ordinary lives. The eSIM service is offered from within the app, so issuance, activation, and management of connectivity happen from the same place where the customer makes their payments and organizes their finances. A further benefit is customer retention: when both finance and connectivity are being managed from the same app, switching to another fintech is probably one disruption too far.

Bandwidth is easily and inexpensively available from established operators who own and run the physical infrastructure. The predictable costs and scalable revenues that can be realized from eSIM services is another inducement to fintechs.

These services also deliver a significant benefit: richer, data-driven insight into how customers engage and transact. A fintech that offers travel connectivity to its premium customers is gaining unprecedented visibility into their travel habits. It knows where they are, and when they go there. This opens up an entirely new range of services: travel options, accommodation, insurance, concierge services, and tips on where to go and what to eat – plus deals on all those things. 

The eSIM is the first step toward offering the customer highly targeted offers that raise the fintech’s revenue, while deepening the engagement of the user in the ecosystem that the fintech has created and curated.

The ecosystem is the key

The confluence of market trends, new technology, and a demographic shift toward a digitally native population that is constantly on the move has fueled fintechs’ appetite for offering eSIM services. But to really understand this evolution, it is important to realize that the eSIM service is not a goal in itself, but rather an enabler of a larger shift. The long-term objective is a comprehensive travel ecosystem where every component works together to enable each other and the whole. Crucially, the portal to that ecosystem is the app on the customer’s device. 

If one looks to the future, it isn’t too far-fetched to see fintechs being considered the “natural providers” of connectivity for car services or wearable device management. When “digital” is in both the fintech’s DNA and its customers, there really is no limit to where the partnership can lead.

This coming together of finance and connectivity should be seen as yet more proof of a real shift in how digital services are conceived and received. The idea of a frictionless digital experience exists in every industry. But to offer that experience from one app, across fields, in an integrated and curated fashion – that is the sort of ecosystem the modern premium customer craves. 

Offering eSIM services is more than just an “opportunity” – it is an essential evolution for an organization that has aspirations to truly be a “partner” in the lives of its customers. 

The right partner is necessary to make the most of this evolution. G+D is such a partner, a SecurityTech player with a global footprint and local knowledge wherever it is required. Our expertise spans payments and connectivity. G+D’s offerings in the eSIM sphere include an in-house authentication suite, a deep – and growing – partner pool, and open APIs, and its strengths include advising on strategy and compliance.