The award-winning fintech company Retail Capital, which finances South African small and medium-sized businesses, is one of several new initiatives that TymeBank, South Africa’s fastest-growing digital bank, plans to use to strengthen its business banking offering. Retail Capital will join TymeBank as a division and serve as the hub of the bank’s expanded business banking services, subject to regulatory approvals.
“This acquisition will enable TymeBank to expand its offering to entrepreneurs to include working capital finance. Retail Capital has acquired significant risk management experience over the past decade and through different economic cycles. They have an experienced team in place and their risk models and operational processes have been battle-tested and optimised to a significant degree for small-business funding. Together, we look forward to providing access to innovative solutions to ensure business owners can fuel their growth, drive job creation and contribute to the broader economy,” said TymeBank CEO Coen Jonker.
Why The Acquisition?
- Retail Capital’s funding expertise and TymeBank’s deposit base and operations would be integrated to service a larger customer base under the terms of the acquisition agreement. TymeBank thinks that being able to properly channel funds to South African business owners is important to the advancement of the previously underserved small business sector.
- The two companies have a lot to offer, with an increasing array of digital technologies that make doing business in a difficult climate easier. TymeBank’s current Business Banking offering, which now has over 100,000 users, offers, among other things, a transactional business account that can be started in under five minutes, zero monthly bank fees, free debit card and online purchase transactions, and free bulk payments.
- Through a simple three-step online application process, Retail Capital lowers the obstacles to funding for SMEs. Over the last ten years, Retail Capital has supplied over R5.5 billion in working capital to over 43 000 South African business owners, making it the largest SME financier of its sort in the industry. Retail Capital has established itself as an award-winning fintech partner in the last five years, providing businesses with fast access to finance through embedded solutions, and they will continue to help the economy through innovative funding technology and strong partner partnerships.
- Both companies are economically complementary and synergistic. Retail Finance’s small business product offering need a flexible supply of low-cost capital, which TymeBank’s deposit base can deliver.
“Retail Capital has a long history of supporting SMEs by enabling them to access affordable funding that helps their businesses grow. Now, through this acquisition by TymeBank, we will be able to scale the offering, giving SMEs the opportunity to expand through funding that works on their terms. Retail Capital already powers many industry-leading partners in the Acquiring, Retail and Payments space to support their SME customers and the tie-up with TymeBank will further enhance this offering to our partners’ customers. Both Retail Capital and TymeBank have the customer front of mind, and we see the strategic move as a positive one that will greatly assist all business owners in South Africa,” said Retail Capital CEO Karl Westvig.
- Tyme Group’s multi-country digital banking footprint will also allow Retail Capital to expand internationally into new areas.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard. You can book a session and speak with him using the link: https://insightsbyexperts.com/view_expert/charles-rapulu-udoh