Core to Customer: Why Telcos Must Pivot to Financial Services

The strategic path for telcos was once presumed to be a one-way diversification into banking, but a more ominous trend has emerged. Large digital finance businesses are now using mobile services as a loss-leader to keep users loyal to their core financial products. For telcos, this is a race to the bottom that threatens connectivity profits. To survive, firms must treat their future growth engine with the same importance as their commoditized present.

1. Establish the Fintel unit with a direct line to the CEO and Board
2. Avoid the trap of building a banking stack from scratch in-house
3. Partner with end-to-end financial technology specialists
4. Prioritize flexible, API-driven architecture for rapid iteration

How to choose the right financial technology partner?

Success is not determined by a checklist of banking features, which are merely "table stakes". The true determinant is whether the platform enables organizational agility. Telcos must select partners whose technology is built for rapid, iterative cycles, allowing them to test and evolve at the speed of the market.

The "New Telco Maths" graph showing ARPU and Lifetime Value comparisons The shift from binary telco activity to the rising diffusion curve of financial products.

What are the "New Telco Maths" for subscriber value?

Fintel rewrites the value equation by drastically reducing customer acquisition costs—which are virtually zero for an existing telco base—while extending the subscriber's life. This creates a dramatic increase in lifetime value through high-margin cross-selling.

Acquisition Cost: Drastically lower than standalone digital banks
Sticky Revenue: Financial habits are "sticky" and reduce monthly churn
Rising ARPU: Unlike binary telco usage, fintech users adopt more products over time
Contextual Advantage: Telcos can weave finance into existing customer journeys, like roaming or family plans

Is it better to build internal capabilities or partner?

The instinct to build internal software is a common strategic folly for engineering-led firms. The path is clear but not simple, requiring complex regulatory expertise and agile development. Telcos must choose between a high-risk internal struggle or partnering with an innovative platform that has already mastered this complex domain."

“The technology and the strategic model now exist. The only remaining variable is the will to execute. Talk to us."

How is your firm planning to combat the race to the bottom in connectivity pricing?

The shift toward "Fintel" is no longer optional; it is a defensive and offensive necessity. By leveraging deep contextual data and a flexible platform, telcos can achieve a lifetime value of S$2,411 compared to just S$262 for a standard MVNO model.