Nedbank tests e-commerce app

In the hunt for new revenue streams in the crowded SA banking market, Nedbank is testing an app that seeks to grab a slice of the growing mobile payment markets. Nedbank, alongside rivals FirstRand, Absa, Standard Bank and Capitec, is trying to defend market share from newcomer app-only competitors such as Adrian Gore’s Discovery Bank and the Patrice Motsepebacked TymeBank.

In the hunt for new revenue streams in the crowded SA banking market, Nedbank is testing an app that seeks to grab a slice of the growing mobile payment markets.

Nedbank, alongside rivals FirstRand, Absa, Standard Bank and Capitec, is trying to defend market share from newcomer app-only competitors such as

Adrian Gore’s Discovery Bank and the Patrice Motsepe-backed TymeBank, which have set out pricing and margin strategies to lure cash-strapped consumers to their platforms.

In an interview with Business Day, Ciko Thomas, the head of retail and business banking at Nedbank, said the strategic rationale behind the new app, Avo, was to give Nedbank new ways of securing deposits and selling loans to consumers.

“This is built on the principles of what a bank does every day, but we have integrated ourselves into the lives of consumers,” said Thomas.

Avo, which is being tested among the group’s 30,000 employees before being launched to clients and the wider public, would be a platform for every registered business. The app would also come with a mobile wallet, allowing consumers to put deposits in it, as well as the option to buy some products on credit.

“The payment mechanism is at the heart of this thing — some people may choose to keep a balance in the wallet, which then becomes a source of deposit. So it’s no different to how we as a bank think about deposit taking,” Thomas said.

“The other part of it is that if you go to a Makro store, click and buy a TV and it costs you R15,000, I can either load

R15,000 into your wallet or finance it over a period of time. That is a loan.”

Ciko also said the app would allow small businesses without e-commerce platforms to list their services and products on the bank’s super app.

“Most Sundays I do my magwinya run to Diepkloof,” he said, referring to balls of fried dough, also called fat cakes.

“If I can have owners of these shops on my app, I can have my magwinya delivered.”

The platform is much like China’s super app WeChat, which has evolved from being a messaging platform to including a suite of features to order food takeaways, shop online, search for jobs and transfer money without leaving the interface.

It would also give Nedbank useful customer insights it can use to pitch its other products, such as insurance, Thomas said.