NEOBANKS: T-Mobile offers a bank account with all the perks

Following a soft launch in November 2018, T-Mobile has officially taken its Money checking account live for all T-Mobile customers in the US. The telecommunications company has joined forces with digital-only MobileBank who is operated by Customers Bank. Yes, you have to be a T-Mobile customer to take advantage of the account, but it does come with some competitive perks such as: 4% yield per annum on balances under $3,000, full mobile platform payment (e.g., ApplePay or GPay) support, and comes with a Mastercard. There are no minimum balance requirements and no fees to keep it open, however, because T-Mobile Money is not supported by a major bank such as BoFA, it is likely to incur ATM fees. Such perks are indicative of a focus towards a younger market who like the idea of high annual percentage yield, whilst keeping the overall account balance low due to lower incomes -- hello Goldman's Marcus. So why is this notable news? Whilst telecommunications companies offering financial services in the US is not necessarily new, with examples like 2013's "Softcard" (originally called "Isis") - a mobile payments system created from the unique partnership of Telcos -- AT&T, Verizon and T-Mobile with Financial Service companies -- Mastercard, Visa, and AMEX, which subsequently failed due to low customer adoption. We should see more resiliency from the T-Mobile Money account as MobileBank gives T-Mobile an out-of-the-box solution to offer to their 73 million strong US customer base without the need for large capital outlays or significant risk exposures to do so. However, regulatory risk is a major factor at play here, which could be financially crippling if something were to go wrong at a time when T-Mobile Money is regulated as a Financial Services Provider.

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Source: MarketingDigest (SoftCard), CookiesandClogs (Isis), T-Mobile Money