Businessman Dr Patrice Motsepe’s Tyme Group is preparing to launch a third digital bank in Vietnam, Southeast Asia, as it looks to increase its market share on the continent’s banking sector.
Majority-owned by Dr Motsepe's investment holding company African Rainbow Capital (ARC), Tyme Group holds an effective 57.7% stake in TymeBank, which bills itself as South Africa’s first digital-only bank.
After raising $110 million in a Series C capital raise, the digital banking group says it is on an international expansion drive, after launching a second fully digital bank called GoTyme Bank in the Philippines in 2021, in association with local company Gokongwei.
Coenraad Jonker, CEO of TymeBank, tells ITWeb: “We completed the series C funding round last year and raised in total $110 million. We are now looking at entering the Vietnamese market where we will be launching a third digital bank.
“We are hoping to start with launching a product in the second quarter of this year, which will be a merchant cash advance product. After focusing on the merchants, we plan to fully launch the retail bank in mid-2025.”
Tyme’s Philippines operation, GoTyme Bank has reached 2.3 million customers in just 14 months, and has made Tyme’s merchant cash advance product available to 1.1 million MSME businesses located in the Philippines, he adds.
According to the company, across its two markets – SA (8.5 million) customers and the Philippines Tyme’s total customer numbers are now at 10.8 million globally.
In its previous results, ARC said Tyme Group (including TymeBank and GoTyme) had an annual revenue run rate of over R1.8 billion for TymeBank and R100 million for GoTyme.
This week TymeBank announced it became the first digital bank to make profits in SA and on the continent, after reaching its first month of profitability – R 6 million – in December 2023.
According to Jonker, the milestone is proof that the business model is commercially viable and the bank has set out a new target for the next phase of the business, which is premised on a “play to win” mindset.
“Our profit is still reasonably small because our turnover is just over R200 million. So for the rest of the year, we expect this number to grow quiet rapidly. We have set a target to become one of the top three retail banks in SA.
“I will admit this is quite an ambitious target, but it can be done. We certainly have the momentum because we are already on-boarding around 200 000 customers in SA. If we work hard and delight our customers with great products and services, we can definitely get there,” adds Jonker.
Discussing the strategy to reach this target, Jonker points out the bank is focusing on improvements in several key merits, including: customer satisfaction, return on equity, efficiency ratio and scaling the business nationwide.
“We are targeting a return on equity of about 30% for the business. We are also working to keep the efficiency ratio at under 40%, whereas the big banks are currently at an average of 60%. Our net operating income and revenue growth has almost doubled over the last year (100%) and I think we can sustain a 50% plus growth in the coming years.”
The bank will also be adding in-store kiosks across SA’s major retailers and strengthen its relationship with partners Boxer and Pick n Pay.
“The big priority for TymeBank is to keep improving our customer service, and keep improving our products, particularly our app experience. One particular thing to look out for is our virtual card experience. We want to enable our customers to use the virtual card both for domestic and international use,” he concludes.