South African telecom operator Telkom has reportedly forayed into financial services by launching a life insurance business.
The company will initially offer funeral insurance as part of its new insurance business.
According to Reuters, Telkom and several other mobile operators in South Africa are aiming to serve one million people in the country who do not have bank accounts.
These companies are also planning to boost mobile payment apps to widen their customer base.
The move is anticipated to pose a challenge to conventional and digital banks in the country.
Telkom Financial Services managing executive Sibusiso Ngwenya was quoted by Reuters as saying: “In recent years Telkom has made a strategic shift to digital distribution, which puts it in an ideal position to distribute insurance products using its considerable digital structure and intellectual property.”
In addition to life insurance, Telkom also plans to offer business loans and intends to roll out a digital wallet service for customers, according to Sunday Times newspaper advertisement.