Orange boosts banking presence with Anytime acquisition

Orange is ploughing more money into its nascent banking operations in Europe, this time by acquiring small business focused neobank Anytime.

Unsurprisingly, we don’t know how much; the telco did not disclose the value of the deal. However, it claims that business services-focused Anytime is among the top three of its kind in France and has been profitable since 2018, which is more than can be said for Orange’s existing banking operations…although that is in line with expectations at this stage.

Anytime offers bank accounts, payment tools and expense management services to small businesses and sole traders in France, and will provide a useful addition to Orange’s existing consumer banking offer, launched three years ago. The operator plans to further develop Anytime’s offer to include other business solutions, and also sees a cross-selling opportunity.

“Orange already serves several million professional and business customers in France who could also potentially be interested in Anytime’s offers: start-up entrepreneurs, freelancers, the self-employed and small businesses,” it said, in a statement.

Orange may have a sizeable base of business customers in its its home market, but whether it can convert them to banking customers too is a bigger question. Its overall domestic mobile customer base stands at north of 21 million, while at the end of September it reported having 1.1 million Orange Bank users, including mobile insurance customers.

After three years in operation, that’s not a huge number of customers, but it’s not to be sneered at either. Persuading a customer to switch bank accounts from a major name in the industry to a mobile bank is no mean feat and is by no means the same as poaching a mobile customer from a rival. Orange aims to have 2 million customers in France by 2023 and is well on the way to reaching that goal.

The customers it is signing up are also potentially much more valuable – and sticky – than many of its mobile customer base. In its third-quarter report it noted that 60% of new customers in France – excluding mobile insurance, this time – subscribed to paid offers, up from just 29% in the same quarter a year earlier.

Orange Bank is still proving to be a drain on earnings though, accounting for a negative €29 million of EBITDAaL in Q3. That too was an improvement on Q3 2019 though, when the figure came in at €37 million. Economic capex required came in at €7 million during the quarter, up by €1 million year-on-year. Orange expects to hit adjusted EBITDA breakeven for its banking operations in France and Spain (it launched south of the border in late 2019) in 2023.

At its three-year anniversary in November, Orange Bank unveiled new initiatives aimed at families and children – services that enable children to start banking in a semi-autonomous way, backed by a parent-held account, for example.

Clearly Orange has its eye on who its future customers will be, and now, with the addition of Anytime, it is supporting those who could be business leaders of the future too. Banking is a tricky business for anyone to break into, but thus far Orange appears to be heading in the right direction.