TymeBank recently announced that it had received R1.6 billion in new investment, positioning it for significant growth.
Speaking in an interview with MyBroadband, TymeBank CEO Tauriq Keraan said the bulk of this capital will go to expanding the business in South Africa.
TymeBank operates using a hybrid digital banking model, functioning as a digital bank with a widespread physical presence at Pick n Pay and Boxer stores.
As part of how it will spend its newly-received funding, the bank plans to add another 500 staff to these physical distribution channels.
It has reached 2.8 million users and has seen significant growth throughout the COVID-19 pandemic, expecting to reach 3 million users by the end of March 2021.
Strategy in South Africa
Keraan said that the bank’s strategy to compete with traditional banks and new digital-only banks is to position themselves as accessible to all South Africans.
“The first principle here is increasing the access to financial services and banking in this country,” Keraan told MyBroadband.
“But equally important is that we are a bank for all South Africans so we consciously target across sectors.”
He said that TymeBank’s proposition has been getting fuller with time and that adoption is getting better and better.
“One of the major differentiating attributes is that while we are a digital bank, we also make extensive use of physical touch,” Keraan said.
“What this has allowed us to do is to allow us to scale very rapidly in a way that is broadly accessible.”
He added that as a result of its broad appeal, TymeBank was among the fastest-growing banks in the world at the moment.
Becoming a top 3 player
MyBroadband also spoke to TymeBank co-founder Coen Jonker, who said the bank aims to become a “top three” player in South Africa.
“We have always seen banking as a scale game – building a bank is expensive and complex,” Jonker said.
He added that new digital-only banks, including those such as Bank Zero or Spot Money, run the risk of becoming stranded in a niche and limited their potential scale.
“The one thing that is true is that the bulk of economic value goes to the scale players,” Jonker said.
“We want to be a top-three player in South African retail and SME banking. It is extremely difficult to do that to that in a purely digital play.”
He noted that while the bank was certainly monitoring newcomers to the digital banking market, it saw its future competition in South Africa as the big banks – including Standard Bank, FNB, and Nedbank.