Rogers forays into banking

by Gaurav Kheterpal on September 7, 2011

Among the ‘Big Three’, Rogers holds the most diverse portfolio of businesses, spread across multiple verticals. Gone are the days when being ‘Canada’s largest wireless carrier’ was Rogers only claim to fame. Last month, Rogers launched a ‘Smart Home Monitoring Service‘ – a security system that allows homeowners to control appliances remotely using a smartphone.

Several reports suggest that Rogers is gearing up for an NFC mobile-payment launch by the end of the first quarter of 2012. Though earlier reports speculated Rogers may choose to work with Toronto-Dominion Bank Group, a major Visa card issuer, with 4 million card accounts, the company has literally decided to take the matter in its own hands – Rogers want to operate a bank in its home country, primarily to handle credit-card payments for its customers.

The implications of this move could be massive – pitting the country’s largest wireless provider against the biggest financial institutions in the land.

Rogers says it intends to apply to the Minister of Finance to incorporate under Canada’s Bank Act. The lender will be called Rogers Bank, and Banque Rogers in French-speaking Quebec. The company is seeking permission to offer its own credit cards within the next few years. Although launching credit cards is a common phenomenon among retailers, Rogers is perhaps the first telecom company to foray into this business.

To put things in perspective, Canada has 22 domestic banks, 26 foreign banks, including HSBC Bank Canada and Walmart Canada Bank, and 23 foreign lenders with full-service branches. Rogers says it has no plans to foray into daily banking operations, such as deposits. IMO, this move will help Rogers in a couple of ways – first, it would help expand the company’s reach beyond media, cable and wireless businesses and secondly, it would provide a test bed for its ambitious NFC plans.

“We have no plans to become a full-service deposit-taking financial institution,” Rogers Public Affairs Manager Carly Suppa said in an emailed statement. “The license, if granted, would give us the flexibility to pursue a niche credit card opportunity to our customers should this make sense at a future date.”

The CBC report raises an interesting point that Rogers has already been acting like a bank for some time as it sells handsets at a discount to customers and then has them pay back the savings in a ‘bank-like’ fashion over time in the form of a long-term contract.

So, would you bank with Rogers? Have your say be leaving a comment.

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Written by: Gaurav Kheterpal. www.digitcom.ca. Follow TheTelecomBlog.comby: RSS,TwitterFacebook, or YouTube.

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UNDERGRAD4LIFE September 7, 2011 at 11:23 am

WITH MORE THAN THREE QUARTERS OF EARNINGS FROM WIRELESS, ‘COUNTRY’S LARGEST CARRIER’ STILL VERY MUCH APPLIES. DO YOUR HOMEWORK.

Jordan Richardson September 8, 2011 at 12:40 am

What Guarav says is ” Gone are the days when being ‘Canada’s largest wireless carrier’ was Rogers only claim to fame.” Practice your reading, UNDERGRAD4LIFE.

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