Revolut and N26 eye Europe’s telecoms sector – But why?

Two of Europe’s leading digital banks are preparing to enter a new battleground.

Revolut and N26, best known for reshaping consumer finance with slick mobile banking apps, are now setting their sights on Europe’s €500bn telecommunications market.

Their ambition: to become mobile network players, offering full-service plans and challenging some of the continent’s most entrenched telco incumbents.

New MVNOs

Revolut this week unveiled its new mobile plan in the UK, promising unlimited calls, texts and data, along with 20GB of roaming across the EU and US, for an introductory £12.50 per month.

It plans to extend the offering to Germany shortly, coinciding with Berlin-based N26’s own launch into mobile services.

Both companies are expected to operate as mobile virtual network operators (MVNOs), leasing capacity from existing carriers rather than building infrastructure from scratch.

The rationale is clear.

“Neobanks are mobile-first by design,” says Matt Halligan, CTO at Optiva, a telecoms tech firm. “They already have the agility and customer engagement needed to support a telco offering.”

Indeed, Revolut’s fintech infrastructure lends itself to digital integration.

The new service will be fully embedded within its app, enabling users to manage telecoms and finances side-by-side — even using RevPoints, the company’s loyalty currency, to pay for mobile plans.

Can it Really Work?

Yet despite the fit on paper, analysts warn that Europe’s telecoms industry is a fortress.

In Germany and the UK, Revolut and N26 will face entrenched players such as Vodafone, Deutsche Telekom and BT.

Kester Mann, a telecoms analyst at CCS Insight, is sceptical: “Neobanks can win some customers, but penetrating a market with tens of millions of existing connections will take years. It’s unlikely they’ll ever be dominant.”

Moreover, MVNOs are inherently reliant on their host networks.

This could limit Revolut’s and N26’s ability to innovate at speed or control pricing — a critical risk for firms that pride themselves on agility.

“Without end-to-end control over service delivery, fintechs risk undermining their own brand promise,” Halligan notes.

Still, their cost structure gives them a potential edge.

Not needing spectrum licences means lower capital outlay, allowing aggressive pricing strategies.

And with Revolut recently posting pre-tax profits of £1.1bn, it can afford to treat telecoms as a loss leader — cross-selling users into more profitable services like wealth management or credit cards.

In many ways it’s an audacious move and the timing is opportune. With consumers increasingly managing everything online — from shopping to investing — integrating mobile plans into a finance superapp could appeal to digital-first users.

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