T-Mobile Launches New Attack... Against the Banking Industry?

[dgstorm]

T-Mobile has been on a roll lately. Ever since they got fired up and started rattling off new phases in their Uncarrier initiative, they have been making other carriers sweat from the massive value and changes they offer to consumers. Apparently, shaking up the wireless carrier industry isn't enough for T-Mo though. Now it looks as if the Uncarrier wants to disrupt the banking industry as well!

T-Mobile officially announced their new program called, Mobile Money. It's basically a checking account for T-Mobile wireless subscribers. This isn't just some gimmicky expensive account which only the elite can afford either. In fact, their account structure is ultra-competitive, offering free activation, free monthly maintenance and free ATM withdrawals at any of the carrier’s 42,000 in-network partner ATMs. Furthermore, there is no fee for replacing lost or stolen cards and there are no minimum balances required.

Here's what T-Mobile's boisterous CEO, John Legere had to say regarding this new program,

“We’ve already transformed how Americans use and pay for phones, tablets and wireless service; why stop there? Millions of Americans pay outrageous fees to check cashers, payday lenders and other predatory businesses – just for the right to use their own money. Mobile Money shifts the balance of power for T-Mobile customers and keeps more money in their pockets.”

Here's the full press release for more details,

T-Mobile Frees Consumers From Outrageous Check Cashing Fees With Innovative New Smartphone Solution

Un-carrier brings its revolution to personal finance with Mobile Money by T-Mobile

BELLEVUE, Wash. — Jan. 22, 2014 — Not content with upending just one industry, T-Mobile US, Inc. (NYSE: TMUS) today announced the company is extending its Un-carrier consumer movement to personal finance – transforming smartphones into personal money managers that can free people from excessive fees they often pay to use their own money.

The company calls this next phase of its consumer revolution Mobile Money by T-Mobile®.

“We’ve already transformed how Americans use and pay for phones, tablets and wireless service; why stop there?” said John Legere, president and chief executive officer of T-Mobile. “Millions of Americans pay outrageous fees to check cashers, payday lenders and other predatory businesses – just for the right to use their own money. Mobile Money shifts the balance of power for T-Mobile customers and keeps more money in their pockets.”

ATM, overdraft and monthly maintenance fees all hit record highs last year, according to Bankrate’s 2013 Checking Survey. Mobile Money helps counter that trend with the combination of a simple, smartphone money management application designed for use with a re-loadable T-Mobile Visa® Prepaid Card that offers many reduced fee or $0 cost services for registered T-Mobile wireless customers.

With Mobile Money, registered T-Mobile wireless customers pay $0 for things they do every day. No charge for activation, monthly maintenance, in-network ATM withdrawals, or for replacing lost or stolen cards. No minimum balances required. No more worrying about overdraft fees. And no unnecessary trips to the bank or a check casher.

At the same time, Mobile Money lets customers do most everything they would otherwise do with traditional checking accounts, including direct depositing paychecks, depositing checks from capable smartphone cameras, making retail purchases, paying bills and withdrawing cash from more than 42,000 in-network ATMs nationwide with no ATM fees[ii]. Mobile Money can also be a powerful tool for families seeking a better way to budget or to provide money to kids away at college. Consumers get all of this plus the ease of managing money any time and from virtually anywhere.

T-Mobile isn’t new to the personal finance arena. With its ground-breaking approach to separating the costs of wireless services and devices, T-Mobile gives customers the option of financing smartphone purchases. To date, T-Mobile has facilitated billions of dollars in loans for customer phones, all without charging a penny in interest.

Mobile Money builds on T-Mobile’s financing experience to provide a sensible and affordable alternative to checking fees for the roughly 68 million U.S. adults who do not have traditional accounts and have to rely on alternative financial services[iii].

“It’s ridiculous that families, especially those who can least afford it, have to pay so much for basic check cashing services that many of us take for granted,” said Mike Sievert, chief marketing officer for T-Mobile. “Mobile Money levels the playing field to put money back in consumers’ pockets for important things – like bills, groceries or vacations. The typical household using a check casher to cash their paychecks could save about $1,500 per year, and customers tired of getting hit with overdraft fees can switch and save an average of $225 a year[iv].”

Starting today, individuals can register for their personalized T-Mobile Visa Prepaid Card at https://t-mobilemoneyservices.com/. Cards will also be available in participating T-Mobile retail locations and beginning in February will be available in Safeway stores in the United States.

For more information, please visit: Prepaid Card | GPR | Mobile Money | T-Mobile.

 

[pc747]

So a cell phone company who no longer believes in contracts wants you to put all your money in a bank they run (in business with).

When can I sign up (sarcasm)?

Personally I will pass I do not even allow companies to auto draft out my account. I would rather pay you 2 months payment in advanced before I give you my bank info.

With that said, how long before we see AT&T or Verizon do the same thing?

 

[kodiak799]

It's an interesting idea. I do pay a few bills out of my checking account, and a few others with my VISA (where there's no transaction fee). That's usually enough to waive any account fees.

Now the ATM transaction fee can be a nuisance, but I don't get cash much and it would take minimal planning on my part to avoid. That's the only compelling part of this, really. But 42,000 ATM's nationwide is pretty impressive.

 

[akhenax]

If there were no ATM fees period, I would see trying this service. That was the very reason I went to TD Bank, years back. They have since reneged on that though.

 

[johnomaz]

I dunno. I just got a Google Wallet card because Google has been using the wallet service for a while now and it seems as secure as my own bank card. I however don't pay any bills with my Google Wallet card. I mostly use it for starbucks and fast food when I want it. Lets face it though, most people have direct deposit and pay bills with their bank account/debit card. There isn't much money exchanging hands. It could be a way for people just out of high school to get their first checking account (or even in school still, I dunno, I'm old).

It could also potentially make TMobile money. Banks use the money deposited into accounts for other investments that in turn make them money (sometimes lose it too /cough financial system collapse) and could mean TMobile would be making money on something else other than their service.

I don't plan on using it but I'm sure there are others that will. I also don't think it'll change the banking system. TMobile does have a good chunk of the cell phone industry finally, but in terms of being a bank, they are still in diapers.

 

[Xtra Big Kahuna]

This actually makes a lot of sense for them. They have made people get rid of their contracts which means they are no longer "required" to stick it out for two years so if something were to happen that they didn't like they could just pull out without any issues but now if people had money being stored by the carrier that makes it much more difficult to just pack up and leave T-Mobile. This is going to keep the people who store their money with them from jumping ship as quickly as before.

I personally wouldn't put my money in with T-Mobile but I am sure there are quite a few people that would.