Monzo Eyes Mobile Phone Market with Digital SIM Launch

Monzo, a digital bank, is exploring the launch of a digital SIM, which connects to a mobile network without a physical SIM card, and offering monthly contracts. The move could see Monzo take on the UK's biggest phone networks. Monzo is likely to enter the market as a mobile virtual network operator, similar to Giffgaff, Voxi, Tesco Mobile, and Lebara.

Monzo, a prominent UK-based digital bank, is reportedly considering the launch of its own digital SIM service, which would allow customers to connect to a mobile network without the need for a physical SIM card. The company aims to offer monthly contracts, potentially challenging the UK's established phone networks. This move follows similar initiatives by other fintech companies like Revolut and Klarna, which have also expressed interest in the mobile virtual network operator (MVNO) market.

According to sources cited by the Financial Times [1], Monzo is in the early stages of planning this venture. The company's decision was driven by customer feedback, indicating that mobile contracts can be a cumbersome process. Monzo aims to streamline this experience by offering its unique take on mobile services.

As an MVNO, Monzo would not need to build its own infrastructure. Instead, it would leverage the existing networks of major telecoms operators like EE, Vodafone, Three, and Virgin Media O2. This strategy is similar to that of other MVNOs such as Giffgaff, Voxi, Tesco Mobile, and Lebara, which often undercut traditional operators on price and offer more flexible contracts.

The UK mobile market is seeing growing interest in MVNO services. According to Enders Analysis, MVNOs in the UK added 1.6 million customers in 2024, while the traditional four operators collectively lost 180,000 subscribers in the same period [2]. This trend indicates a significant shift in consumer preferences towards more flexible and cost-effective mobile plans.

Monzo's entry into the mobile sector could have a substantial impact on the market. With over 13 million customers, including 12.5 million personal banking customers and upwards of 700,000 business customers, Monzo has a large customer base to cross-sell services to [1]. James Robinson, senior analyst at Assembly Research, noted that these new entrants could significantly influence the British mobile market by offering attractive deals on price and other terms such as roaming charges [1].

This move aligns with Monzo's strategy to diversify its revenue streams and provide more value to its customers. While the specifics of Monzo's plans remain unclear, the company's focus on customer experience and innovation suggests that its entry into the mobile market could be a game-changer.

References:
[1] https://www.pymnts.com/news/digital-banking/2025/monzo-becomes-latest-bank-tackling-mobile-phone-market/
[2] https://www.datacenterdynamics.com/en/news/monzo-plans-to-launch-uk-mobile-service-report/