Competition beefs up as new MVNO enters South Africa’s market. The new entry is the South African insurance company, Old Mutual, it launched a Mobile Virtual Network Operator (MVNO) on Cell C.
Clarence Nethengwe, OM Bank’s CEO designate, confirmed that the MVNO service, known as Old Mutual Connect, is part of the company’s Integrated Financial Services (IFS) strategy to provide tangible value-added services to its customers.
The company plans to provide competitive mobile services that will transform connectivity in the lower-income market, while also providing “unrivalled value” in data packages to customers.
“Affordable data and reliable connectivity is critical for our customers in the mass market to fully participate in the mainstream economy. It is also an important enabler for our customers to interact with the rest of our propositions digitally,” Nethengwe shared.
He confirmed that the MVNO will leverage a multi-operator core network agreement to provide reliable, high-speed mobile services, operating on Cell C’s network, which has existing agreements with Vodacom and MTN.
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Customers can purchase a SIM card for R5 ($0.29) at any Old Mutual branch. They can also buy data and airtime through branches, partners, and digital channels.
In September 2024, Old Mutual announced plans to launch a bank in the first quarter of 2025. The Prudential Authority has approved the firm’s systems, certifying that they’re fully operational. It has also appointed Clarence Nethengwe as the CEO-designate of the bank, effective 1 November.
MVNO market has recently experienced significant growth
South Africa’s mobile virtual network operator (MVNO) market has recently experienced significant growth, with new entrants joining the sector over the past five years.
MVNOs are cellular service providers that don’t own network infrastructure and instead buy wholesale access from a mobile network operator to provide connectivity to their subscribers. Analysis showed that by December 2023, the number of MVNO SIMs in the SA market had surged to over 4.3 million, marking an annual growth rate of 51%.
The market is expected to continue to grow, with projections indicating that it will reach 10 million SIMs by December 2028, while the potential entry of large retail brands could accelerate growth, potentially pushing the market to 13.5 million SIMs.
Old Mutual Connect joins a slew of other mobile operators, including Capitec Connect, which is currently regarded as South Africa’s largest MVNO after recently revealing that it had over one million active SIMs, and FNB Connect, which has 879,000 active SIMs in 2022 and hopes to reach one million soon.
In August 2024, C-Connect, a new virtual mobile network operator (MVNO), was also launched. It also leverages C-Cell’s network infrastructure.
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