TymeBank is extending its services to the affluent market, with plans to offer new products and enter distribution partnerships that will help it to acquire those customers.
The company also aims to extend credit to the cash-strapped middle class as part of its plan to tap into unsecured lending and savings products.
“When it was formed five years ago, the bank had a limited product range, which meant it was not attractive to the wealthier segment. We have matured significantly in the last five years in terms of our product offerings,” TymeBank’s incoming CEO Karl Westvig said.
“The plan is to make sure we have a proposition that is valuable for the mass affluent market and find distribution channels to be able to plug into that. We have had discussions with partners who have mass affluent customers to whom we can bring a valuable offering.”
Westvig — who starts his new role in October, has 30 years of experience in credit and risk lending after establishing financial services start-ups RCS Group and Retail Capital, which was acquired by TymeBank a year ago — has his work cut out for him to better position Tyme’s brand in a highly competitive environment.
We are rolling into the personal loan space ... While it is a fairly well-served market, there is certainly a growth potential for us
— Karl Westvig, Tyme Bank CEO
For the past 18 months, Westvig has been responsible for TymeBank’s business and consumer lending, as well as its retail bank.
He succeeds Coenraad Jonker, who will focus on chairing the Tyme Group, headquartered in Singapore, whose growth ambitions will see it listed on the New York Stock Exchange and the JSE in 2028.
Speaking to Business Times, Westvig said the group aimed to promote short-term lending products such as personal loans; buy now, pay later offerings; and business lending, so people could have greater access to credit.
“What is interesting about TymeBank right now is that it is great for transactions, great for savings, and a good deposit book. Where we want growth with TymeBank is in the lending space,” he said.
The bank’s short-term lending ambitions would be driven mainly by the group’s partnership with TFG — one of South Africa’s biggest retail brands.
“We are rolling into the personal loan space. It is a fairly well-served market, with the large banks playing into that space. We have partnered with TFG, and on the back of the TFG partnership we have access to TFG customers as well as TymeBank account holders. That is a market we are growing into. While it is a fairly well-served market, there is certainly a growth potential for us,” he said.
Established in 2019, TymeBank, which describes itself as South Africa’s first licensed digital bank, is majority owned by Tyme Group, a subsidiary of billionaire Patrice Motsepe’s investment holding company African Rainbow Capital.
It is valued close to $1bn (about R18bn) and became Africa’s first digital bank to reach profitability in Africa.
Roughly the number of customers TymeBank signs up each month.
— IN NUMBERS: 200,000
Tyme Group has 12.5-million customers, while TymeBank boasts 9-million in South Africa and is set to have 10-million by the end of the year.
The bank is on a growth trajectory, signing up between 180,000 and 200,000 customers a month, Westvig said.
“What we need to do is to ensure that as many of them [customers] are as active as possible, so we can give [them] reasons to bank with us. That means making sure we have all the services they need,” he said.
Westvig said that, while Tyme’s plan was to build a full-service offering for its clients, long-term services such as home loans were not on the radar, unlike Discovery Bank, which announced a home loan product with a promise to cut customer interest rates by 1%.
“It is not short-term product expansion for us. For now, [growth] is going to be more in the unsecured lending space, transactions and savings. We have plans to build a strong credit card offering, and that is across the international group and in South Africa, the Philippines and Vietnam. Work is being done in the background around a credit card offering. The secured lending space is in the medium term,” he said.
Westvig said, given the strong legislation around affordability designed “to make sure we are not over-leveraging customers”, the bank would “grow slowly into that space”.
When asked whether there were any acquisition plans in the short-to-medium term, Westvig said the group was looking at joint venture opportunities with large partners that would allow the group access to distribution and lending assets.
“We have some partnerships in the pipeline and not acquisition per se,” he said.
TymeBank’s first offering five years ago was through banking services at Pick n Pay and Boxer. It later added TFG.
When asked if the group had discussed Bidvest Bank, which was put up for sale last month, Westvig said: “We have discussed it internally, but we are focused on building our internal bank right now. Taking another bank on is a big ask for the management team.”
Westvig said that, as a digital bank, Tyme wanted to provide its customers with the best user experience, from when they opened an account right through to when transactions took place.
“It needs to be a frictionless, enjoyable experience. There’s a lot of focus on making sure our systems are working well, so that if customers have issues, they are resolved easily. We want to become the most-loved bank in South Africa.”
Tyme Group has an international footprint in the Philippines and Vietnam, with plans to expand into Indonesia by year end.
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