Orange Bank to Add a Premium Visa Card

Orange Bank to Add a Premium Visa Card

FACTS

  • Orange Bank plans to launch a paid premium card offer with embedded dynamic CVx on March the 7th 2019.
  • Costs: This Visa Premium card will be charged €7.99/month, or slightly more than €95/year. The basic card will still be proposed for free, is used to make at least 3 payments each month.
  • How it works? The card will embed a battery, and will regularly display updated CVx numbers by way of improving remote payments’ security. Orange also plans to add a service for recycling these media.
  • Benefits: in addition to a dynamic CVx, along with typical services also available with the basic card offer, this Visa Premium features:
    • Commission-free wash withdrawals and payments outside of the euro zone sans commission
    • A full set of assistance services and travel-related insurances (trip modification, cancellation or interruption; trip delayed; lost, damaged or stolen luggage, etc.)
    • Higher limits on cash withdrawals and payments
  • Other services should be added over the weeks and months to come:
    • Fund the associated Orange account with a payment card from another account. Subscribers may also add money to their Orange Bank account via credit transfer, direct debit or payment card. Orange claims these transactions will be processed instantly in-app.
    • Request money via text message. Orange Bank customers may then be paid back more easily (if in the Single European Payments Area). A €500 limit applies to each request.

CHALLENGES

  • After changes in their leadership were announced, Orange Bank aimed for strategic shifts to ensure more profit from their business model and come up with distribution relays to increase customer acquisition. This premium card is but a first step: other announcements are expected, including a range of credit-related services and payment facilities, as well as a car insurance option.
  • By way of facing up to competition, Orange Bank bets on highlighting specific card features, such as a dynamic CVx (which has only been added by few traditional banking players) or encore advantages for travellers (not even yet featured by Revolut).

MARKET PERSPECTIVE

  • Orange Bank aimed for 30% of active accounts after one year, but very few customers actually opted for Orange Bank as their main account. In order to increase this base of active users and talk their customers into relying more on their mobile phone, they bet on occasional operations, including this new Visa Premium card.
  • Applied price ranges may, however, put some customers off: this amount is higher than Visa Premier offers from online banking players, even if relatively similar to mobile banks’ offers (€9.99 for N26 and €7.99 for Revolut).

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