* Three bank/telecoms alliances make Poland a test ground
* Mobile banking seen as growth source in saturated markets
* EU single market drive could encourage alliances elsewhere
By Adrian Krajewski
WARSAW, June 20 Polish banks and telecoms firms
are joining forces to offer low-cost banking on mobile phones,
in what could be a test run for similar tie-ups across Europe as
companies look for new ways to win and keep customers in
European banks and mobile companies have so far been wary of
sharing their customer bases, and put off from alliances by
onerous regulations in some markets, as well as a reluctance
among some consumers to hold multiple bank accounts.
But that may be starting to change as sluggish growth in
both of their industries push them to consider new options, and
as the European Union standardises regulations and promotes
competition in its drive for a single market across the region.
In Poland, where regulations are comparatively light and
multiple bank accounts already commonplace, the local arm of
German telecoms group Deutsche Telekom and Alior Bank
have teamed up for a mobile banking service which they
think could provide a blueprint for the rest of the continent.
"It should show the way in which banking and telecoms are
heading," said Miroslav Rakowski, chief executive of T-Mobile
Polska, Deutsche Telekom's Polish business.
Broadly speaking, the relationship works like this: T-Mobile
gets access to Alior's financial services and online banking
technology which it can offer to its clients, giving them a
reason to stay loyal to the operator in a competitive market.
Meanwhile Alior, a mid-tier lender which at the moment has
over 250,000 Internet banking clients, gets a chance to persuade
T-Mobile's 15.6 million users to open a bank account with it.
As for customers, they get a free bank account and a debit
card - which contrasts with the charges levied on some accounts
in Poland and elsewhere in Europe - as well as the ability to
make online money transfers and payments, and to take out loans.
They can also get up to 500 zloty ($160) cashback if they
use the account to pay telephone bills and make at least one
monthly card payment using so-called "near-field communication"
- which allows shoppers to buy items by tapping their phone on a
Early signs are good, with 1,000 customers a day signing up
for the deal since its launch last month, according to Rakowski.
Tibor Bokor, a London-based analyst at investment bank Wood
& Co, believes it could be harder to make a splash with such an
offer in some western European markets. In Britain, for example,
most bank accounts are already free, while in many markets there
are an array of banking and payments apps to choose from.
However, he added the forecasts for banking tie-ups made by
Polish mobile firms during recent roadshows were "more bullish
than I imagined." The forecasts have not been made public.
"We're at the testing phase. Once we learn from it, it could
maybe be replicated in the West and definitely should be
replicated in eastern countries that are directly comparable to
Poland," Bokor said.
Deutsche Telekom board member Claudia Nemat said experience
from the Alior tie-up would be applied in comparable projects in
the Czech Republic, Macedonia and Slovakia, and also in its home
market of Germany.
It is not alone is using Poland to try out a bank alliance.
France's Orange has said it is planning a similar
offer in conjunction with German lender Commerzbank's
Polish business mBank - Poland's fourth-biggest lender.
Meanwhile, Poland's third-largest mobile operator Polkomtel
, a unit of Polish media group Cyfrowy Polsat,
is already bundling its offer with a small lender, Plus bank.
The bank and Cyfrowy have the same controlling shareholder.
"ONE PLUS ONE EQUALS 2.2"
Some telecoms firms have been experimenting with financial
services for a while, and many banks already offer mobile
banking. But working together can share the costs.
Last year, Spain's Telefonica and lenders CaixaBank
and Santander announced a venture to develop
new business opportunities, while in the United States, T-Mobile
has launched a Visa card with banking features,
including allowing consumers to deposit cheques using smartphone
The crossover between banking and telecoms has been greatest
in Asia and Africa, tapping into markets where many people do
not have bank accounts, yet mobile phone use is widespread.
Vodafone's M-Pesa service, for example, is growing
rapidly in Africa. It partners with banks in some countries, and
Vodafone said this year it was extending the service to Europe,
starting with Romania.
The flurry of activity in Poland, however, marks it out as a
particular test ground. Rather than focused on reaching
customers relatively new to banking, it is about seeing whether
telecoms firms and banks can work together in saturated markets
to win customers from rivals, and then keep them.
With around 57 million SIM cards and 38.5 million bank
accounts in a country of 38 million people, Poland is becoming a
tougher market for both banks and telecoms firms.
Polish lenders expect only a 1.1 percent rise in their net
profit this year, with the effect of an improving economy likely
to be offset by low interest rates which squeeze banks' margins.
Last year, Poland's biggest bank PKO BP and
second-largest Pekao both launched mobile payment
systems that do not involve direct partnerships with telecoms
operators, which have together attracted around 130,000 users.
But for mid-tier or smaller banks, without the marketing
resources of the bigger players, such investment is much harder,
making a tie-up with a telecoms firm an attractive way to offer
customers the cutting-edge services that can help them compete.
"Clients don't live for banking, they bank to accomplish
their goals. So a bank cannot be cocky anymore," said Wojciech
Sobieraj, the CEO of Alior Bank, which is controlled by Carlo
Tassara Group, a holding company for French financier Romain
The Alior/T-Mobile service is backed by the marketing muscle
of Deutsche Telekom: it is running an advertising campaign
fronted by Polish soccer star Robert Lewandowski, who from next
season will play for German champions Bayern Munich.
Like rival offers, it sees potential in a market where
almost half of mobile customers own smartphones, but only about
14 percent of bank customers use phones for banking.
As for the telecoms sector, it is also struggling for
growth, and across Europe regulators are cutting the fees mobile
operators charge rivals for using their network. According to
audit firm Audytel, revenue in the Polish mobile phone sector
will fall 1.3 percent this year to 22.9 billion zlotys.
That has resulted in cut-throat competition among operators,
and a search for new services to attract customers from rivals
and persuade them to stay.
"Our observations show every new service limits the need
(for customers) to change operators," said Mariusz Graca, who
sits on the board of Orange Polska, the unit preparing
a tie-up with mBank. "We aimed for a partnership in which one
plus one equals 2.2, and we'll split this 0.2 with our partner."
($1 = 3.0500 Polish Zlotys)
(Additional reporting by Marcin Goclowski in Warsaw, Gergely
Szakacs in Budapest, Leila Abboud in Paris, and Eric Auchard;
Editing by Mark Potter)