France’s Orange is paving the way towards a move which would see it “diversify into banking services”, entering into negotiations with insurer Groupama that could see it take a 65 per cent stake in its banking unit.
In a statement, Orange said the partnership is intended to enable the launch of “Orange Bank” in France at the start of 2017, followed by other European launches, such as Spain or Belgium. Once established, it would offer all standard banking services, as well as savings, loans and insurance products.
By potentially acquiring the 65 per cent stake in Groupama Banque, Orange said it could “benefit from an existing operational infrastructure for the launch of Orange Bank”. Groupama will be able to “strengthen its online banking business”.
Potential financial terms of a deal were not disclosed.
Orange CEO Stephane Richard revealed in March last year that the company was looking at mobile banking as one way to diversify its operations, with an objective to reach €400 million in revenues from financial services in 2018.
The company already offers financial services in Africa and the Middle East through Orange Money, and recently launched Orange Finanse in Poland.
Commenting on the Groupama announcement, Richard said: “Orange benefits from a unique combination of essential assets that will enable it to successfully launch a highly innovative, 100 per cent mobile bank.”
For Groupama, Orange said it will bring its “digital knowledge to develop a 100 per cent mobile offer corresponding to new uses increasingly employed by the two partners’ customers”.
“Orange’s technological leadership and the ubiquity of mobile phones will enable us to move forwards, faster and further, to create a bank that factors in all the possibilities and the fluidity that is inherent in today’s technology,” added Thierry Martel, CEO of Groupama.
The banking push from Orange comes as the company also revealed it had entered into preliminary talks to potentially merge with smaller rival Bouygues Telecom in the French telecoms market.Subscribe to our daily newsletter Back