In some regions of the world, especially in Africa, cell phone operators have become de facto banks, in some cases all but replacing local currencies with balances traded over SMS. Here in the U.S., it’s only recently that carriers have seriously started to investigate the feasibility of mobile payments; even then, it’s with the help of traditional financial institutions.
T-Mobile is taking a different step by offering its customers – often very cost-sensitive – new banking services. As a part of the service, T-Mobile will offer users a physical pre-paid Visa card at basically zero cost. Unlike some banks, T-Mo won’t charge for (in-network) ATM withdrawals, won’t force users to carry a minimum balance, or levy fees for lost or stolen cards.
In many respects, the service acts like a traditional checking account – minus the writing of checks – including cashing checks via your smartphone’s camera in order to add funds to the account.
Starting today, you can register online for a prepaid Visa card; customers will also be able to pick up cards in some carrier shops and, starting next month, in Safeway supermarkets.
A T-Mobile money management app will be used to manage the new accounts.
The move isn’t quite as risky as it sounds, despite the fact that no credit check will be required to access the service (making it a good fit for the “Uncarrier’s” pre-paid smartphone plans). The company, and The Bancorp Bank who manages the cards, will likely be able to leverage customer deposits to make back any costs that they’ll incur.