TymeBank, the digital bank in which Patrice Motsepe’s African Rainbow Capital (ARC) is majority shareholder, said it reached its first month of profitability in December 2023. The milestone comes four years after its 2019 launch.
“We are extremely proud of our achievement, particularly when you consider that globally, less than half of the top 100 digital banks are profitable. In fact, a recent study stated that less than 5% of all neo-banks worldwide had reached profitability. And of those that are in the black, most have taken a lot longer to become profitable,” said Coen Jonker, CEO of TymeBank, in statement on Tuesday.
This milestone comes only two months after TymeBank announced the acquisition of its eight millionth client in October 2023, making it the fourth-largest bank by customer numbers in South Africa. “We believe that we are now perfectly aligned with our goal of becoming one of the top three retail banks in the country,” said Jonker.
TymeBank attributes its rapid growth trajectory and its fast turn towards profitability to a number of factors, including the bank’s digital channels being supported by in-store kiosks at major retailers including Pick n Pay, Boxer, Sportscene and other TFG outlets, a strategy it says helps acquire about 150 000 customers each month. TymeBank also has a lending portfolio growing at about 30% annually, driven mostly by its small business lending product called Merchant Cash Advance.
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Although the low-cost digital offering TymeBank offers to the market is mainly aimed at low-income earners and the unbanked portion of the population, its appeal is growing among more sophisticated segments of the market, too, it said. “As the business evolves, we are seeing it gradually appeal to more affluent consumers who appreciate its unrelenting innovation, customer-centric transparency and accessibility,” said ARC’s Motsepe. – © 2024 NewsCentral Media
AI-generated summary of this article
- TymeBank is a digital-only bank in South Africa that offers low-cost banking services.
- The bank has turned its first profit after launching in 2019 and acquiring more than three million customers.
- The bank plans to expand its products and enter new markets in the future.
