Mobile phone operator O2 has announced it is branching out into the personal finance market in a bid to cash in on the growing demand for mobile banking services.
The group, which has an exclusive deal with Apple’s iPhone 3GS, has teamed up with high street bank NatWest to offer two pre-paid cards through its new O2 Money business.
The cards, which will be available from late August, are the first in a planned line of financial products which will be offered to the group’s customers.
O2 to move into mobile phone banking
Ronan Dunne, O2’s UK chief executive, said: “O2 has a strong and successful track record of innovation and O2 Money will represent a launchpad into a wide range of mobile banking services.
‘We believe that we are at the start of a journey towards the coming together of phone and wallet and we intend, through O2 Money, to be at the forefront of this trend.
‘This launch represents an important step towards O2 becoming a leading service provider with mobile at its core.’
He added that the group hoped to take a ‘significant share’ of the pre-paid card market.
Mobile phone banking open to pay monthly and PAYG customers
The group said the two pre-paid cards would help people manage their money as they would be free and people could not go overdrawn on them or incur interest charges. Customers will also be sent a balance update to their mobile phone after each transaction to help them keep track of their spending.
The Cash Manager card will be available to O2’s Pay Monthly and active Pay & Go customers. People can transfer money on to the card online and can then use it on the high street, internet or for cash withdrawals in the same way they would a debit card. There are no charges for using the card in the UK, although there are fees if it is used abroad.
Load and go
The second card, Load and Go, is aimed at young people who want the security of using a card rather than carrying cash on them, as the card can be blocked if it is lost or stolen.
It is available to O2 customers aged over 13, but a letter will be sent to the parents of those aged under 16 who want one of the cards, informing them of the application.
Parents can load money on to the card over the internet while money can also be added to it at more than 20,000 locations across the country, including all O2 stores and PayPoint outlets.
The card can be used like a debit card but there are certain websites and outlets where it will not be accepted, such as online gambling sites.
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