TymeBank hits 7.4 million customers in South Africa – with profitability right around the corner

Digital banking group TymeBank has expanded rapidly since its launch in 2019 – with its customer base on par with the likes of Nedbank.

The bank launched in February 2019 and hit the milestone of 1 million customers in November that same year.

In 2020, its customer base quadrupled to 4 million, boosted by targeting relatively untapped markets, including a partnership with the Zion Christian Church (ZCC).

By 2021, it was comfortably adding around 130,000 new customers per month, and by the end of 2022, it had hit the 6 million customer mark.

Reporting its full-year results for the year ended June 2023, African Rainbow Capital Investments – the 50% shareholder of TymeBank – said the digital banking giant has now surpassed 7.4 million customers in South Africa.

This has been driven by another partnership with The Fochini Group (TFG), where 600 kiosks were installed across 22 brands within the TFG stable – almost doubling TymeBank’s distribution across South Africa, the group said.

“This contributed to record levels of new customers being onboarded and is expected to become an important channel partner for TymeBank,” ARC said.

ARC noted that the company also experienced a marked increase in the average customer activity levels and is actively using technology to help unlock potential SASSA general grant recipient customers.

“Between Pick n Pay, Boxer and TFG, TymeBank has a large cash network,” it said.

For context on the scale of TymeBank’s customer base, Nedbank’s interim results (also to the end of June) reported that it had “more than 7 million” retail customers.

What’s notable about TymeBank’s customer base, however, is that it they are purely digital. While groups like Absa have a bigger retail base (11.8 million customers at end June 2023), only 3.5 million of these are digitally active.

Expansion

TymeBank is also expanding its business and operations, ARC said. In the year under review, the bank acquired a fintech funder of small and medium enterprises, Retail Capital.

“The transaction will support TymeBank’s offering to its business banking clients. In the last 10 years, Retail Capital has provided funding of more than R5.5 billion to more than 43,000 business owners in South Africa, making it the largest SME funder of its kind in the sector,” it said.

TymeBank also launched a fixed deposit product in April 2023 which is “demonstrating good traction”.

In line with the bank’s successes, ARC has continued to invest more money into the group, having contributed $67.5 million of the $125 million capital raised to acquire Retail Capital.

ARC has maintained its shareholding in TymeBank at 50.21%.

According to the group, the total value of ARC’s investment in TymeBank is R4.2 billion, representing a 45% uplift. This puts the bank’s total valuation at around R8.4 billion.

Operationally, TymeBank is expected to reach profitability by December 2023, ARC said.

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