(Ecofin Agency) - South African telecom operator Telkom announced on August 2 it is launching a new mobile financial service on the local market. The service is a funeral insurance offer in collaboration with the insurer Guardrisk. This investment is in line with the strategic reorientation adopted by Telkom to diversify its revenues to cope with the rapid fall in the fixed-line segment, which now represents only 20% of its revenues against 56% in 2013.

“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,” said Sibusiso Ngwenya, Managing Director of Telkom Financial Services.

In addition to funeral insurance, Telkom also plans to offer a credit service to businesses. The telco also plans to launch a digital wallet service soon, allowing customers to purchase products and pay for services via its Yep! app and other online transaction platforms.

Telkom’s strategy comes amid the coronavirus context that has increased demand tenfold. Last July, Vodacom Group announced its ambition to create, in partnership with the digital payment provider Alipay, an app for online shopping, bill payment, and remittance. Eleven (11) million South Africans are still without access to traditional financial services.