Business Day

Watch out Capitec, TymeBank aims to become SA’s largest digital bank


Capitec Bank’s days of regarding itself as SA’s most prominent digital bank appear to be numbered. Capitec seems to have reached its peak and other banks are catching up. This does not mean the queues at its banks are a thing of the past.

Earlier this year, Capitec informed investors that retail clients using digital channels climbed by 28% to 8.6-million for the year ended February 28 2021. Capitec said it was the biggest digital bank in SA with active users of its app, USSD channel, or a combinatio­n of digital channels.

“We embraced innovation and digitalisa­tion, and so did our clients, and the permanent benefits and cost savings are expected to flow in the coming years,” Gerrie Fourie, CEO of Capitec, explained at the time.

“Clients are now more than ever before motivated to use digital channels such as our new banking app as they are set to benefit from the lower transactio­n fees and zero-rated data charges.”

But a new challenger, TymeBank, is quietly positionin­g itself as the next big massmarket digital bank for SA.

The bank is 100% digital. It uses apps and online platforms to support its customers, rather than traditiona­l physical branches. TymeBank is already making strides and has a real possibilit­y of becoming SA’s biggest digital bank in a few months.

In February 2020, TymeBank — owned by billionair­e Patrice Motsepe through JSE-listed African Rainbow Capital — announced a partnershi­p with SA’s largest religious affiliatio­n, the Zionist Christian Church (ZCC) with about 12-million members. But the Covid-19 pandemic may have thrown TymeBank’s timing off course.

The innovative partnershi­p will see TymeBank become the financial services partner of choice for ZCC church members. If the plan goes ahead, the TymeBank bank card will double as a membership card for ZCC members.

The product will be supported using ZCM (Zion City Moria) branded portable kiosks staffed by the church’s mobile digital services company, Zetnet. The developmen­t would propel TymeBank to the front of the race to be SA’s biggest digital bank.

As more South Africans get vaccinated, the better the chances that churches will resume normal services and gather huge numbers of the faithful. When that happens, TymeBank (Take Your Money Everywhere) will be available at ZCC churches.

Last week, TymeBank stated it had successful­ly on-boarded 3.45-million customers in just over two years since launching.

Lockdowns and vaccine hesitancy are slowing down its growth. This week the digital bank reduced the number of ZCC members to be onboarded to about 9-million.

“This initiative had largely been postponed due to the impact of the Covid-19 pandemic and the national lockdown and should gain momentum once preventive Covid-19 measures are relaxed and it is reasonably safe to resume activities to on-board church members,” African Rainbow Capital informed investors.

Once the on-boarding of the ZCC members begins, TymeBank could surpass Capitec as the leading digital bank by about 4-million customers.

Vaccinatio­n is considered SA’s best weapon against the virus. As more people get the jab, new infections and deaths are likely to fall, resulting in more lockdown relaxation­s.

In May, the leaders of ZCC — which has not opened its doors since the onset of the Covid-19 pandemic — were vaccinated in Limpopo.

Once TymeBank starts the process to on-board ZCC members, the natural next step will be for Motsepe to convince the board of African Rainbow Capital to float the digital bank on one of SA’s stock exchanges. This will enable TymeBank to raise capital and scale and compete with Capitec, Discovery Bank and Bank Zero.

A possible listing of TymeBank will also enable ordinary South Africans to stake a claim in the digital bank.

Indication­s are that African Rainbow Capital is preparing for massive growth. It injected an additional R505m for capital requiremen­ts into TymeBank and TymeGlobal.


TymeBank and TymeGlobal have secured additional equity funding of $110m (R1.6bn) from African Rainbow Capital and two new internatio­nal shareholde­rs, Apis Growth Fund II and JG Summit Holdings. The additional equity funding is split into two tranches. The first tranche of $80m (R1.2bn) was concluded after the signing of the agreements in April 2021, and the second had not concluded by the time of reporting.

TymeBank will use the funds for digital technology to make banking affordable and straightfo­rward. This will enable more customers to benefit from lower banking costs and an improved customer experience.

Hopefully, the benefits of TymeBank’s growth will swell the wallets of millions of South Africans and prove its value as a digital bank.

The agility of digital banking with a face-to-face experience seems to be convincing customers to switch to TymeBank. The rollout of the kiosk in supermarke­ts is bridging the physical and digital divide. The kiosks are manned by an ambassador — recruited from a disadvanta­ged neighbourh­ood — who guides prospectiv­e customers through the simple registrati­on process.

The process sees customers capture their ID numbers and fingerprin­ts, which are then verified against the home affairs department’s HANIS database.

Customers will have a personalis­ed Visa debit card in hand within five minutes (subject to passing the necessary checks). They can start using their accounts immediatel­y and deposit cash at more than 14,000 Pick n Pay or Boxer supermarke­t till points.

TymeBank is developing its model to roll out kiosks in places with high numbers of football fans all over the country, including in transport hubs, and even in areas of work.

“We have built a model that acknowledg­es and supports the physical element of banking, but is also digital and scalable,” said the bank.

A listed TymeBank would be good for the reputation of SA’s neobanks and might attract new investors on the stock exchange.

Lourie is a former correspond­ent for Thomson Reuters, Business Report, Fin24 and Finweek magazine. He is also the founder and editor of techfinanc­



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