26 September 2023
Major benefit to South Africa as TymeBank attracts significant foreign investment from global investors
Johannesburg and London: Leading South African digital bank TymeBank has secured an investment amounting to R1.6 billion, attracting new investors from the UK and Philippines.
The investment, which is one of the largest foreign investments any fintech company has secured in South Africa, will be deployed to bolster TymeBank’s growth and secure its path to commercial success.
The investment represents a strong endorsement for both TymeBank as one of the world’s fastest growing digital banks and for South Africa’s banking sector overall. Like all banks in South Africa, TymeBank is regulated by the Prudential Authority of the SA Reserve Bank. TymeBank is the first bank in South Africa to be operated fully off a cloud-based infrastructure network. It was also the first bank to be granted a commercial banking license since 1999.
TymeBank currently boasts some 2.8 million customers and is expected to reach a milestone of 3 million customers by the end of March 2021. This month the bank is celebrating its 2nd anniversary, having officially launched on 26 February 2019.
TymeBank is a member of the Tyme group of companies, which is headquartered in Singapore.
The new investors in TymeBank are Apis Growth Fund II, a private equity fund managed by Apis Partners (Apis), and JG Summit Holdings (JG Summit), which is one of the largest and renowned conglomerates in the Philippines and owned by the Gokongwei family. Both these investors are experienced in financial services in emerging markets. Apis is a private equity asset manager that supports growth stage financial services and financial infrastructure businesses.
Along with TymeBank’s existing shareholders, which includes majority shareholder African Rainbow Capital, the new investors are committed to grow TymeBank into a top tier retail bank in South Africa. They have also entered into an agreement to launch a digital bank in the Philippines, testament to the innovation and digital banking capabilities TymeBank has built.
Of the total investment of R1.6 billion, some R500 million has already been invested. The balance of R1.1 billion will be invested over the next 12 to 15 months.
TymeBank values the global expertise that Apis and JG Summit will bring as shareholders and Apis as a Board member. Apis has a strong focus on measuring the sustainability and societal impact of an investment in a company or business. Apis’ experience through its network of payments companies, microfinance banks, and fintech platforms will provide valuable experience for TymeBank through its expansion phase.
Both Apis and the Gokongwei family made the investment in TymeBank based on the strength of TymeBank’s value proposition. TymeBank is satisfying customer demand for low and transparent bank fees, which is generally viewed as both costly and difficult to understand in South Africa. The bank is also improving access to underbanked and under serviced people in the country.
TymeBank onboards an average of 110,000 new customers per month, making it globally recognized for digital banking in emerging markets. The onset of the Covid-19 pandemic has led to increased demand across all customer income groups in South Africa for digital banking options. This supports TymeBank’s goal to grow its customer base to 4 million by 2022.
The new investment will allow TymeBank to further expand its range of banking products and grow its lending portfolio. The bank will also seek to enhance its propositions in insurance, credit cards, and other value-added services to customers. This will support the bank’s ethos of broadening access to financial services to individual clients, entrepreneurs, small and medium business owners into the banking ecosystem.
In line with the bank’s purpose to drive financial inclusion and increase customer choice in the banking sector, TymeBank offers a transactional bank account with no monthly fees and an immediate access savings product with a competitive interest rate. Most TymeBank customers are on-boarded via its physical kiosk located in Pick n Pay and Boxer stores across the country.
Overall, the foreign investment is seen as a positive development for both the South African banking landscape as well as the country in general.
Commenting on the transaction, Dr Patrice Motsepe, Chairman of African Rainbow Capital, majority owner of TymeBank, said:
“As the controlling shareholder in TymeBank, African Rainbow Capital is delighted to have our new co-investors onboard. Equally important, Apis and the Gokongwei family invest in TymeBank at a time when significant uncertainty reigns globally and in South Africa as a result of the Covid-19 pandemic. The invested amount of R1.6 billion is no small feat – both in terms of drawing investment into South Africa’s financial services sector as well as investing into a fledgling part of the sector in our country. We look forward to a long-term partnership with Apis and the Gokongwei family.”
Mr Lance Gokongwei, President and CEO of JG Summit commented:
“We see digital banking as the next growth area globally and increasingly in ASEAN and so we are excited to partner with global investment giants Apis and ARC in taking part in this global play by building further successes for South Africa’s leading digital bank TymeBank. The investment not only propels the Gokongwei Group to accelerate its foray into disruptive digital plays, it also allows us to learn more about TymeBank’s experiences that provide a good impetus for us in considering to apply their technology and success in the Philippines.
“With the Philippines progressively going into digital banking to bring about better financial inclusion for a greater majority of its population, this augurs well to help us successfully deliver on our purpose as a business – that of having an unrelenting commitment to provide our customers with better choices, creating shared success with our various stakeholders.”
Mr Matteo Stefanel, Managing Partner of Apis Partners commented:
“As an experienced investor in financial services, we are thrilled to partner with the team at TymeBank who have built an exceptional business in a competitive market such as South Africa. We are confident that this investment will accelerate TymeBank’s growth and already impressive onboarding figures.
“Managing to source, evaluate and close this deal whilst Covid-19 uncertainty was still rife in the market is a testament to the strength of the teams at both Apis and TymeBank. We look forward to continuing this relationship over the coming years.”
Mr Udayan Goyal, Managing Partner of Apis Partners commented:
“As smart banking usage increases globally, TymeBank is well positioned to start this exciting new growth phase and we are delighted to support the outstanding team on their path to becoming a leading retail bank in South Africa. Financial inclusion is a core tenet of Apis’ approach; we are proud to share this vision with TymeBank and believe our shared goals will help build a market-leading organisation.”
Mr Tauriq Keraan, Chief Executive Officer of TymeBank commented:
“The establishment of digital banks in South Africa is in its infancy. Growth in this particular segment of financial services is only possible with investments from partners who understand and support the growth trajectory of digital banks. Our new shareholders in TymeBank have significant experience in digital financial services in key emerging markets. We certainly look forward to learning from their experience to enhance our own offering to South African customers.”
Mr Coen Jonker, co-founder of Tyme commented:
“Internationally, digital banks are starting to take significant market share from traditional players. More importantly, they are driving industry transformation and helping more people participate in the economy. Both Apis and JG Summit have already proven their commitment to this cause. We can’t wait to work with them in South Africa, the Philippines and beyond.”
Some aspects of the transaction remain subject to regulatory approvals.
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TymeBank is currently one of the world’s fastest-growing digital banks having on-boarded 2.8m customers 24 months after launch.
The bank is designed to meet the needs of all South Africans by significantly lowering the barriers to affordability and accessibility. The bank’s vision is to create a platform that stimulates economic participation and facilitates broader financial inclusion. TymeBank is majority owned by African Rainbow Capital (ARC) which was founded by Dr Patrice Motsepe, making it South Africa’s first majority black-owned bank.
TymeBank has formed a long-term strategic partnership with Pick n Pay and Boxer stores, allowing its customers to bank where they shop, at Pick n Pay and Boxer stores around the country.
The TymeBank EveryDay transactional account is quick and easy to open. Customers can open a fully FICA-compliant bank account and receive their personalised Visa debit card at a TymeBank kiosk in under five minutes, or they can open an account via the TymeBank website.
No documents are required to open an account – customers just need their South African ID number and cellphone. The FICA (Financial Intelligence Centre Act) process is completed through the capture and verification of biometric and other data at the kiosk. Once the kiosk issues customers with their Visa debit card, they can transact straight away.
When signing up, customers can automatically join the Pick n Pay Smart Shopper programme and get all the benefits of one of the largest rewards programmes in the country. In a South African first, TymeBank customers earn Smart Shopper points everywhere they use their debit card, not just in Pick n Pay stores.
The TymeBank account comes with a unique savings tool called GoalSave. It attracts no fees or penalties and is simple to use. Customers can create individual savings goals, name them, and earn as much as 8% interest per annum.
For more information, please visit www.tymebank.co.za
Tyme is a multi-country digital banking group, focused on bridging the digital divide in emerging markets, by integrating into physical retail ecosystems. Headquartered in Singapore with offices in Hong Kong and Ho Chi Min City, Tyme designs, builds, and operates digital banks for the mass market, with a particular expertise in serving the under-served and under-banked populations in these countries. Tyme recognises the unique challenges of emerging markets digital banks and builds financial education, a high tech – high touch approach, and efficient cash management solutions to meet the unique needs of the emerging mass market in these countries. Tyme is now launching operations in Asia, based on its successful experience in South Africa. Tyme powers its deployments through its loosely coupled microservice platform, with its design and engineering team based in Ho Chi Minh City, Vietnam.
For more information, please visit www.tyme.com
African Rainbow Capital (ARC) is a black-owned and controlled investment holding company which focusses on the South African and African financial services industry and businesses that deliver exceptional returns on equity. The company is 100% owned by Ubuntu-Botho Investments, which was founded by Dr Patrice Motsepe in 2004, with the objective of building a world class financial services company. Ubuntu-Botho Investments became Sanlam’s anchor empowerment partner. In addition, another important objective of Ubuntu-Botho Investments, since its formation, was to contribute to the improvement of the living conditions and standards of living of poor, unemployed and marginalised South Africans.
ARC’s objective is to be a leading provider of financial services, covering the full spectrum of financial service needs, such as life insurance, healthcare, asset management, general financial services, short-term insurance, property and banking. This is achieved through building strategic partnerships, both in South Africa and further afield, by obtaining equity stakes in product providers.
For more information, please visit www.africanrainbowcapital.co.za
About Apis Partners LLP
Apis Partners LLP is an ESGI-native global private equity asset manager that supports growth stage financial services and financial infrastructure businesses by providing them with catalytic growth equity capital. Apis Partners LLP, through its team of close to 30 professionals with deep industry expertise, manages total committed capital from investors (including drawn and invested capital) of ca. US$ 1bn.
Apis Partners LLP is highly conscious of the developmental impact that the provision of growth capital for financial services and financial infrastructure businesses in growth markets can achieve, and as such, financial inclusion is a core tenet of Apis Partners LLP’s approach and investment mandate.
Apis Partners LLP became a signatory to the United Nations backed Principles for Responsible Investment (UNPRI) upon inception of the firm in 2014.
For more information, please visit www.apis.pe
About JG Summit
JG Summit Holdings, Inc. (JGS) is a publicly listed company and is one of the largest and more diversified Filipino conglomerates engaged primarily in businesses that serve a growing middle class with rising disposable incomes in the Philippines, Southeast Asia, and Australasia. It is the holding company for a group of companies with substantial business interests in food manufacturing and agro-industrial and commodities (Universal Robina Corp.); real estate and hotel (Robinsons Land Corp.); air transportation (Cebu Pacific Air); banking (Robinsons Bank); and petrochemicals (JG Summit Petrochemical Corporation). The Company also has core investments in telecommunications and power generation and distribution.
For more information, please visit www.jgsummit.com.ph