Brazilian postal service Correios will enter the consumer mobile market with its own pay as you go (PAYG) service.
The launch is expected for January 2017 and the company hopes to get at least 1 million prepaid SIMs in the first year of operation.
Correios also expects to generate revenues of R$4.5m ($1.24m) in 2017 as well as R$2.1m ($583,000) in top-up sales within that timeframe.
There are more mobile phone lines than people in Brazil, with 272.4 million mobile subscriptions shared among a population of 200 million, according to the Brazilian telecoms regulator, Anatel.
But the majority (78 percent) of the population remain on prepaid contracts.
The Correios service will operate on a network owned by EUTV Consultoria e Intermediação de Negócios. Additionally, the company also had to request a mobile virtual network operator (MVNO) license from Anatel.