Guaranty Trust Bank plc, one of Africa’s foremost financial institution has been named the Best Bank in Africa 2019 by Euromoney at its annual Awards for Excellence, which held in London over the week.
The Bank was also named the Best Bank in Nigeria for a record ninth time, reflecting the Bank’s position as one of the best managed financial institutions in the country, with strong and focused leadership that keep the business in a constant state of re-invention and innovation.
Now in its 50th year, Euromoney is the leading publication for covering the growth of international finance. Euromoney’s Awards for Excellence are the awards that matter to the banks and bankers who matter. This year, Euromoney received almost 1,500 submissions from banks in an awards programme that covers 20 global awards, more than 50 regional awards, and best bank awards in close to 100 countries.
The Magazine’s Awards for Excellence celebrates the best banks around the world by recognizing institutions that have demonstrated leadership, innovation, and momentum in the markets they operate. In selecting its award recipients, Euromoney combines quantitative and qualitative data to honor institutions that have brought the highest levels of service, innovation, and expertise to their customers.
Key to the emergence of GTBank as the Best Bank in Africa and the Best Bank in Nigeria, is the Bank’s digital drive and its clarity of vision in reimagining the future of banks and banking. The Euromoney awards also recognized GTBank’s commitment to leading the future of banking as well as its consistent long-term strategy led by a senior management team that abhors complacency and keeps the business in a constant state of innovation.
Commenting on the Bank’s Euromoney awards, the Chief Executive Officer of GTBank, Segun Agbaje, said; “We are delighted and proud to win the Euromoney Awards for Africa’s Best Bank and Nigeria’s Best Bank. These awards reflect the progress we are making in delivering the best banking experience that captures what customers want in the world of today and tomorrow. They are also a testament to our leading role in driving world-class corporate governance standards, excellent service quality and innovation in Africa’s banking industry.”
He further stated that; “At GTBank, we are passionate about building the bank of the future by leveraging the best of technology to add real value to our customers’ lives, and these awards illustrate the hard work and commitment of our staff, management, and board towards achieving this goal.”
GTBank has consistently played a leading role in Africa’s banking industry. The GTBank brand is regarded by industry watchers as one of the best run financial institutions across its subsidiary countries and serves as a role model within the financial service industry due to its bias for world-class corporate governance standards, excellent service quality, and innovation.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.
Temenos, the banking software company, today announces that Barko Financial Services selected Temenos software to replace its legacy systems, in both core and front office, to offer a compelling and personalized customer experience.
The microfinance institution will use cloud-native, cloud-agnostic Temenos T24 Transact, the next generation in core banking, and Temenos Infinity, the breakthrough digital banking product.
Barko Financial Services is in the process of applying for a banking license with the ambition to launch a retail bank that will challenge the status quo in South Africa by offering financial products aimed at better meeting the needs of lower-income South African consumers – Temenos will provide the technology to enable this strategy.
The microfinance institution has over 170 branches and caters for millions of modest-earning, but salaried South Africans such as government employees, mineworkers, and civil servants. Currently, it takes Barko Financial Services 25 minutes to onboard a client and 10 to 15 for a new loan application.
With Temenos’ packaged, integrated software, Barko Financial Services will dramatically reduce the time to originate loans, targeting re-loan applications to be completed in under two minutes and new loan completion in under seven minutes. The aim is to give customers, who are mostly located in rural areas, a compelling digital experience using mobile devices, thereby eliminating the need to visit a branch.
By selecting Temenos’ end-to-end digital banking platform, Barko Financial Services will benefit from accelerated project timelines and drastically reduced the cost of deployment. The microfinance institution is expected to go live in six months. Cloud-hosted Temenos Infinity will allow Barko Financial Services to gain product agility and take new products and services to market faster. Temenos T24 Transact will enable the business to benefit from operational efficiencies at a lower cost of ownership.
Temenos has more than 25 years of global banking expertise and a local presence in Africa. Temenos consistently invests over 20% of its revenue into continually enhancing its packaged software, to develop the richest and deepest functionality in the industry.
Kobus de Wet, Chief Executive Officer, Barko Financial Services, said: “We are delighted to be working with Temenos as our strategic technology partner. Temenos has a worldwide reputation for robust, scalable banking software and an extensive presence in the African region.
We selected Temenos’ packaged and open banking software to transform our customer experience, offer personalized products and services and drastically lower our total cost of ownership. With Temenos, we will be able to launch capabilities faster, if we get approval to establish a bank, and provide innovative products which are simple to use and tailored to add value to our target customers. We wish to offer lower-income customers a personalized experience that is typically reserved for private clients.”
Jean-Paul Mergeai, Managing Director – the Middle East and Africa, Temenos, said: “Technology is playing a pivotal role in making financial inclusion a viable option for everyone. We are delighted to partner with Barko Financial Services, which joins the Temenos family, and it can leverage our experience of serving over 220 microfinance institutions as well as our expertise in helping new banks to launch.
By selecting our cloud-native, cloud-agnostic packaged software Barko Financial Services will benefit from a fast implementation. Barko Financial Services will be best positioned to leverage technology innovation to offer an outstanding customer experience at a reduced cost. We look forward to working with Barko Financial Services as it transforms the services that it offers to its customers.”
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.
The African Development Bank Group said on Friday that two General Electric Co subsidiaries would be temporarily barred from bidding on power contracts as part of a settlement of misconduct cases.
The agreement bars GE Power units in Egypt and Germany from bidding for up to 76 months, the bank said. The units, former parts of Alstom that GE acquired in 2015, were found to have engaged in bribery and fraud in 2006 and 2011, the bank said.
“This conduct happened long before GE acquired Alstom’s power business and we cooperated fully with the investigation,” GE said in a statement. “Ethical behavior and compliance are foundational to GE’s ability to successfully operate in more than 180 markets around the world.”
Other development banks may also enforce the bans, the bank said. “We have no reason whatsoever to doubt that the Asian Development Bank, the European Bank for Reconstruction and Development, the Inter-American Development Bank and the World Bank Group will follow the African Development Bank’s lead,” Johann Benohr, a senior advisor to the director of the office of integrity and anti-corruption at the African Development Bank Group, said in an email to Reuters.
The barred entities are Alstom Egypt for Power Projects S.A.E., based in Cairo, and GE Power Systems GmbH, based in Mannheim, Germany, the bank said.
GE is trying to restore profits at its money-losing power business as the conglomerate slims down to three main product lines: power plants, jet engines, and wind turbines.
African Development Bank turns to a hedge fund to offset the risk
The pioneering deal comes as supranational face pressure to expand lending capacity
The African Development Bank is paying a New York hedge fund to take on some of the risks of losses on its loans in a pioneering deal which illustrates the growing financial sophistication of supranational institutions. The AfDB has bought insurance on a $1bn portfolio of loans from a group of investors led by Mariner Investment Group through a so-called synthetic securitization, in which the hedge fund does not acquire the assets but will take on $152m of default risk in exchange for returns in the low double digits.
Supranational organizations, which are backed by groups of nations and so enjoy the world’s highest credit ratings, are under pressure from the governments that fund them to seek new ways of bolstering their lending capacity. By turning to Wall Street to take on some of its lending risks, the AfDB has reduced the amount of capital it has to hold against the loans and thereby freed up more lending capacity. While this financing structure has already been used by banks — Mariner signed a similar deal last year with Crédit Agricole — it is the first time that a supranational development bank has engaged in this kind of financial engineering.
The deal will “super-charge our ability to invest in urgently needed projects across Africa”, according to AfDB president Akinwumi Adesina. “It leverages our financial resources so we can have more impact, and it creates new pathways that enable long-term investors to support Africa’s development while getting excellent financial returns.” In the decade since the financial crisis supranationals have significantly stepped up their capital markets activity, with their low cost of capital making them a cost-efficient way of financing development and infrastructure projects. However, they are still small by comparison to sovereign states’ finance-raising volumes — the assets of the world’s multilateral development banks are approximately equivalent to those of a medium-sized international investment bank.
Given governments’ reluctance to boost supranationals’ capitalization through additional financial contributions, the AfDB-Mariner deal has attracted political attention. Canada helped advise on its structure, the European Commission has insured a $100m tranche of the loans and Africa50, an investment platform backed by 27 African nations, also invested in the deal. Bill Morneau, Canadian minister of finance, said: “Attracting more private capital into global development efforts is critical to building economies that work for more and more people around the world. “That is why Canada and our G20 partners have been calling on multilateral development banks to use their existing resources as efficiently as possible and to look for new ways to attract more private capital.”
A report by thinktank ODI earlier this year concluded that synthetic securitizations were the best mechanism by which multilateral development banks could increase the amount of financial firepower they had available to lend. The AfDB’s deal covers approximately 40 loans to power, transport, finance and manufacturing projects across more than 15 African countries.
The bank has promised to lend the freed-up funds to projects which meet sustainable and social impact targets. The AfDB will take the first $20m of losses on the portfolio. Mariner portfolio manager Andrew Hohns said the deal “may well provide a template for unlocking significant private sector and impact capital into urgently needed projects in developing economies”. Mariner now hopes to sign similar deals with other multilateral institutions. Mizuho structured the transaction.
AfDB imposes debarments to restore integrity in project development.
March 25, 2019
Following years of investigation into alleged bribery and fraud, the African Development Bank (AfDB) and GE Power have reached a settlement on legacy Alstom misconduct.
The AfDB imposed debarments of 76 months and 12 months on former Alstom companies after it was found to have engaged in bribery and fraud in 2006 and 2011 in relation to two bank-financed Egyptian power generation projects. GE Power acquired the companies in 2015.
Last week, the bank announced a conclusion of a settlement agreement with GE Power, thus resolving sanctionable practices committed by former Alstom companies.
“Corrupt practices in the power generation sector directly undermine the African Development Bank’s operational priority to light up and power Africa. This can never be accepted by the Bank”, said Bubacarr Sankareh, manager of the investigations division within the Office of Integrity and Anti-Corruption.
Sankareh added: “We are very pleased that GE Power is joining us today in our efforts to fight corruption and to ensure the delivery of value for money to the bank’s regional member countries.”
Corrupt practices
An investigation conducted by the bank’s office of Integrity and Anti-Corruption established that in 2006 and 2011 the companies, then named Alstom Power Generation AG, Alstom Power GmbH, and Alstom Egypt for Power & Transport Projects, engaged in two instances of corrupt practices and in one instance of a fraudulent practice in the context of the bank-financed Suez Thermal Power Plant Project and the El Kureimat III Power Project, both in Egypt.
GE Power assumed control over these three companies in 2015 after the misconduct had occurred when it acquired Alstom’s thermal power generation business. As part of the settlement, the bank imposes on former Alstom Egypt for Power & Transport Projects S.A.E. (now known as Alstom Egypt for Power Projects S.A.E.), based in Cairo, Egypt, and on former Alstom Power Generation AG (now known as GE Power Systems GmbH), headquartered in Mannheim, Germany, a debarment of 76 months.
Debarment period
The debarment period may be reduced to 48 months if the companies comply with all conditions of the agreement early.
This debarment may be enforced by other multilateral development banks under the Agreement for Mutual Enforcement of Debarment Decisions, including the Asian Development Bank, the European Bank for Reconstruction and Development, the Inter-American Development Bank and the World Bank Group.
Further, pursuant to the settlement, former Alstom Power GmbH (now known as GE Power GmbH), equally based in Mannheim, Germany, is debarred for a period of 12 months.
Among other conditions for release from debarment, GE Power commits to collaborate with the Office of Integrity and Anti-Corruption in the fight against corruption in the power generation and transmission sector.
Tender processing
In 2006, Alstom Egypt for Power & Transport Projects S.A.E. and Alstom Power Generation AG participated in a tender for steam turbine generators in the context of the Bank-financed El Kureimat III Power Project.
The companies indirectly paid an amount of €963,477 to their local agent.
The Office of Integrity and Anti-Corruption has concluded that one purpose of the payment was to ensure the support of public officials involved in the procurement process in order to gain an unfair competitive advantage in the tender.
Further, the Office of Integrity and Anti-Corruption established that the companies had erroneously only declared €50,000 in fees paid to its local agent.
In 2011, Alstom Egypt for Power & Transport Projects S.A.E., Alstom Power GmbH, and Alstom Power Generation AG, by then renamed Alstom Power Systems GmbH, participated in a tender for a steam turbine generator and condensers for the Bank-financed Suez Thermal Power Plant.
In the context of this tender, the companies indirectly offered €1.7 million to their local agent.
The Office of Integrity and Anti-Corruption has concluded that one objective of the offer was to ensure that public officials would assert undue influence on the procurement process in favor of the companies’ bid.
In reaching this settlement, the African Development Bank took into account General Electric’s substantial cooperation with the investigation of the legacy cases as well as the high quality of the company’s comprehensive compliance programme, which now applies to the Alstom entities acquired by GE Power.
African Development Bank debars CHINT Electric for 36 months for fraudulent practices
The African Development Bank Group has announced the conclusion of a settlement agreement with CHINT Electric Co., Ltd., a power transmission and distribution equipment manufacturer and EPC contractor.
An investigation conducted by the Bank’s Office of Integrity and Anti-Corruption established that CHINT Electric engaged in a multitude of fraudulent practices: In bidding for contracts in the context of numerous Bank-financed power projects, the company misrepresented its experience with similar assignments in order to meet qualification requirements.
As part of the settlement, in consideration of the company’s cooperation with the investigation, the African Development Bank imposes a debarment on CHINT Electric for a period of three years, subject to the company enhancing its corporate compliance program within that period to the institution’s full satisfaction.
During the debarment period, the company is ineligible to be awarded contracts under any African Development Bank-financed project or to be a subcontractor, consultant, supplier, or service provider of an otherwise eligible firm in the context of a Bank-financed project.
The debarment qualifies for cross-debarment by other multilateral development banks under the Agreement for Mutual Enforcement of Debarment Decisions, including the Asian Development Bank, the European Bank for Reconstruction and Development, the Inter-American Development Bank and the World Bank Group.
The African Development Bank will verify the adequacy of CHINT Electric’s compliance framework and the robustness of its implementation prior to any release decision. In addition, CHINT Electric commits to cooperate with the Office of Integrity and Anti-Corruption in its investigations of unrelated cases of misconduct in African Development Bank-financed projects.
The period of debarment may be reduced to 24 months if CHINT Electric complies with all conditions of the agreement early.
“Procurement under the Bank’s rules aims at ensuring optimal value for money for the Bank’s Regional Member Countries,” said Bubacarr Sankareh, Acting Director of the Office of Integrity and Anti-Corruption of the African Development Bank. “The misrepresentation of a bidder’s qualifications materially undermines this objective and is therefore taken very seriously by the institution.”
Between 2012 and 2017, CHINT Electric participated in the tenders for: the supply of 132-kV and 66-kV substation equipment for the Mendi substation and others in the context of the Bank-financed Rural Electrification II Project in Ethiopia, the supply of substation equipment in the context of the Bank-financed Emergency Power Infrastructure Rehabilitation Project in Zimbabwe; the design and supply of 132-kV equipment for the Yabello and Buee substations in the context of the African Development Bank-financed Rural Electrification II Project in Ethiopia.
It also participated in the design and supply of a total of four substations at Iringa, Dodoma, Singida and Shinyanga in the context of the Bank-financed Electricity Transmission System Improvement Project in Tanzania; the transmission rehabilitation of the Marvel and Chertsey substations equipment in the context of the African Development Bank-financed Emergency Power Infrastructure Rehabilitation Project – Phase II in Zimbabwe; works and equipment for the Prince Edward Dam substation and others in the context of the Bank-financed Emergency Power Infrastructure Rehabilitation Project – Phase II in Zimbabwe; and the transmission rehabilitation of the Sherwood and Orange substations in the context of the African Development Bank-financed Emergency Power Infrastructure Rehabilitation Project – Phase II in Zimbabwe.
In the context of the above tenders, CHINT Electric misrepresented the technical specifications, the value, the execution period and/or the degree of completion of contracts used as credentials in order to qualify for the tenders.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.
Africa’s output grew by 3.4 percent between 2017 and 2018 despite the slowdown in global growth during that period, a new report by the African Export-Import Bank (Afreximbank) has shown.
The African Trade Report 2019: African Trade in a Digital World, launched today in Moscow during the 26th Afreximbank Annual Meetings, states that Africa’s total merchandise trade in 2018 had a value of over $997.9 billion, noting that the continent remained one of the fastest growing regions in the world.
World Trade Organisation estimates show that the volume of global merchandise trade grew by 3 percent in 2018, down from 4.6 percent in 2017.
According to The African Trade Report 2019, the findings highlight the resilience of Africa’s economies to global volatility at a time of rising uncertainty, escalating trade wars and tariffs between the United States, China, and others. The resilience reflects the diversification of Africa’s trading partners in the context of South-South trade, growing fixed investment and public and private consumption, boosted by expanding urban populations and softening inflation. These factors reduce Africa’s exposure to the business cycles associated with individual countries and regions.
The report noted that while the European Union remained Africa’s main continental trading partner in 2018 – accounting for 29.8 percent of total trade – African trade with the South grew significantly over the last decade to account for more than 35 percent of the continent’s total trade in 2018. China and India further consolidated their positions as Africa’s first and second single largest trading partners, accounting for over 21 percent of total African trade in 2018.
Intra-African trade also increased steadily in 2018, growing by 17 percent to reach $159 billion.
The report highlights that Africa has the potential to do more, noting that its contribution to global trade remains marginal at 2.6 percent, up from 2.4 percent in 2017, and that, while intra-African trade rose to 16 percent in 2018 from 5 percent in 1980, it remains low compared to intra-regional trade in Europe and Asia.
The report states that ongoing digitalization is paving the way for a new African economy, with e-commerce platforms and internet penetration expediting transactions, reducing costs and leading to a new generation of transnational digital consumers.
The report urges African governments to further capitalize on the opportunities associated with digitalization, by bolstering regulatory environments and supporting the development of digital ecosystems.
Digitalization, the reports states, can unlock Africa’s potential in driving economic development and the integration of African countries into the world economy. It can also reduce the region’s dependency on raw commodities and natural resources by helping economies diversify into more value-added products that can enhance extra-and intra-African trade.
According to Prof. Benedict Oramah, President of Afreximbank, “It is vital that Africa grasps the economic growth opportunities flowing from the African Continental Free Trade Agreement, growing domestic demand and population, and our ever-closer investment and trading links with emerging partners in the South. We must exert concerted action to ensure that we develop, industrialize and diversify our industries and supporting infrastructure to foster regional integration and participate fully in regional and global value chains.”
In the words of the Chief Economist and author of the report, Dr. Hippolyte Fofack: “Intra-African trade, which grew by 17 percent in 2018, more than three times the rate of growth of extra-African trade, was the major driver of Africa’s total merchandise trade in 2018.”
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.
Good news for small-scale farmers in Kenya. This is a huge opportunity to benefit from the newly signed deal between the European Investment Bank and Equity Bank of Kenya. The two banks have signed an Sh5.7 billion (EUR 50 Million) deal to finance agricultural development in the country.
Here Is The Deal
In the deal with EIB, Equity Bank through the program termed Kenya Agriculture Value Chain Facility will provide smallholder farmers and small agriculture-based Small and Medium-sized Enterprises (SMEs) with credit to expand their operations.
Working with Equity Bank across the country, the new Kenya Agriculture Value Chain Facility will help agriculture companies to modernize and harness the full economic, employment and export potential of agriculture as well as expand business with local smallholders.
The European Investment Bank aims to extend the project to other financing partners in the future with a focus on service providers expanding their reach to rural communities and smallholder farmers.
Agriculture is the leading source of economic activity, employment, and exports in Kenya. Agriculture contributes directly and indirectly to 51% of Kenyan GDP and accounts for 60% of jobs in the country.
Who May Get The Loan?
The loan program is strictly for agriculture companies and ventures that intend to modernize their ventures as well as embark on agriculture projects that are capable of creating employment opportunities for Kenyans. Agricultural businesses that are also interested in expanding their venture capacities may also apply. The enterprises targeted include Value Chain SMEs in agribusinesses that are supporting a smallholder farmer base.
“Equity Bank has aligned its strategy with the Big Four agenda, which includes agriculture, and our focus is on growing the agribusiness portfolio through servicing all segments from retail to SME to large enterprises and corporate banking customers,” said Equity Bank Kenya Managing Director Polycarp Igathe.
Is The Loan Attractive Enough For Kenyan Small Scale Farmers?
The sum of £50 Million has been budgeted to make this happen. This is the first ever dedicated support for long-term investment by agriculture companies in Africa backed by the European Investment Bank, the world’s largest international public bank.
When procured, beneficiaries will have up to seven (7) years to pay back. This is expected to take care of the highly risky agricultural sector mostly affected by adverse weather patterns.
The maximum amount of loan to be procured by the beneficiaries is 50% of the project cost as long as the beneficiaries are eligible.
Presently, the duration of most loans in Kenya is 12 months. 7 years to pay back the principal sum is a big edge. The new funding would be made available in Kenya Shillings. This will mitigate exposure to foreign exchange risks that currently hinder agriculture investment in Kenya.
“It is good to see the European Union’s bank, the European Investment Bank, partner with Equity Bank. This is the first time the EU funds the private sector in the agricultural sector in Kenya directly. There is a great deal of expectation on this new approach. The EU chose it in Kenya because we recognize that smallholder farmers do not need handouts: they need an enabling environment to be successful market operators. This requires access to finance and reducing the risk of investing in a difficult environment.” said Walter Tretton,Chargé d’affaires of the European Union delegation to Kenya.
Which Bank To Get The Loans From?
Equity Bank is the only Kenyan bank to get the loan from, in the meantime.
Equity Bank is the first Kenyan partner to participate in the Kenya Agriculture Value Chain Facility and other financial institutions are expected to join later. Equity Bank is one of the key financial institutions supporting the agricultural sector in Kenya and is a leading provider of financial services to rural communities and smallholders, the EU bank noted.
The EIB also noted that Equity Bank has identified the potential for growth, by adding medium size and large commercial farmers to the Agriculture portfolio as well as focusing on the financing of the Agri-Food processing companies.
Since 2007, the European Investment Bank has made available one billion euros (Sh114 billion) for private sector investment in East Africa through credit lines in both local and international currency in partnership with more than 25 banks and financial institutions.
Equity Bank Now Has Branch In Addis Ababa Ethiopia
Small scale farmers and businesses in Ethiopia may also now benefit from Equity Bank’s line of credit. This is because the bank has set up a commercial representative Office in Addis Ababa, Ethiopia as it prepares to expand into the hitherto protectionist economy. The bank’s Ethiopia branch is expected to be fully operational next month. The entry into Ethiopia, a country with a population of nearly 100 million people, follows the Government’s appointment of a privatization commission and the ongoing reforms which are aimed at promoting a growing private sector.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.
The stage is set for South Africa ’s new fully digital bank, TymeBank. The bank is on track to hit one million customers by the end of the year. Its current customer base is just a few numbers close to 500,000 customers.
A Look At TymeBank
If you are looking to find any physical branch of the bank in South Africa, you may have to look harder. This is because there is none. The branches exist only in the clouds, that is, the bank is only digitally focused. In February, it launched its EveryDay transactional account bundled with a savings tool called GoalSave, its MoneyTransfer solution, and its TymeCoach App, which gives consumers free access to their credit report, supported by tips on how to make better decisions about the money.
“We are planning to introduce credit products later this year, as well as an SME (small medium sized enterprise) proposition, but for now our focus is on getting simple and cost-effective banking solutions into people’s hands,” said TymeBank chief executive officer, Sandile Shabalala. “Our mission is to drive meaningful financial inclusion, by making banking more accessible to all South Africans. We see it as our responsibility to take the complexity out of banking for consumers and to give them insights into how the financial system works.
“We believe that uncomplicated banking coupled with relevant knowledge will empower people to make more informed and responsible decisions about their own financial futures. Why shouldn’t banks be more transparent with customers about what they are paying for?”
TymeBank is owned by African Rainbow Capital (ARC) Financial Services, a company within billionaire Patrice Motsepe’s Ubuntu-Botho Investments stable. It is South Africa’s first majority black-owned bank focused on retail and business banking.
ARC bought the bank from the Commonwealth Bank of Australia in November 2018.
“TymeBank brought synergies that are complementary to ARC’s existing insurance and asset management businesses. Given ARC’s focus to, mostly, invest in businesses with established client pools, we’ll be looking for synergistic opportunities to the benefit of both the client and TymeBank,” said Tauriq Keraan, deputy CEO of TymeBank.
The latest figure came from the digital bank ’s latest investor prospectus, which detailed its customer acquisition since launching in February.
Chief executive officer, Sandile Shabalala said the group is averaging 100,000 new customers each month.
After bringing on board around 40,000 clients during its ‘soft launch’ phase between November 2018 and February 2019, the bank moved to a high growth phase where it was adding 4,000 new clients a day.
The bank said that it has a total addressable market of around 21 million customers in the middle market, as well as 2 million small-to-medium enterprises, which opens up the potential for products and services it wants to introduce.
TymeBank is looking to disrupt traditional banking in South Africa whose operations are usually expensive to maintain.
“We are leveraging our cloud-based technology which doesn’t come with a legacy burden and it’s one of the many reasons we’re able to pass cost savings onto the consumer. We have built an open banking platform, which allows us to move with speed with the partners we engage with,” said Shabalala.
The Bank Is Relying On Partnership As Its Strength Both For Money Deposit Or Withdrawal
TymeBank has created a network of partners including Pick n Pay and Boxer, with the former’s Smart Shopper program now fully embedded into TymeBank’s technology stack.
“We’ve partnered with companies whose business ethos aligns with what we want to do in the market, which is to do good. The customer will always be at the centre of our banking practices and going forward we will be doing some really exciting things with our partners, it will go way beyond just occupying floor space,” said Shabalala.
The implication of joining forces with Pick n Pay and Boxer stores is that TymeBank now has access to a relatively significant distribution edge.
“By the time we complete our bank kiosk roll-out we will have 730 points of presence where customers can open accounts inside a Pick n Pay or Boxer store — we have over 500 bank-enabled kiosks in the market today.”
Even in stores without a bank-enabled kiosk, customers can still do their everyday banking transactions, TymeBank said.
As part of its acquisition strategy, TymeBank said it will further leverage its partnership with Pick n Pay and Boxer stores, which gives it access to 730 physical stores across the country, where customers can withdraw money free of charge and deposit money for just R4, said Shabalala.
“We have a strong proposition, which competitors will find hard to match right now and the tens of thousands of customers that have opened and are using their accounts are testament to that,” said Shabalala.
TymeBank is part of a trio of banks launching into the South African market in 2019, with the other two banks including Bank Zero, the brainchild of former CEO of FNB, and Discovery Bank.
Again, Rain has recently entered into a partnership deal with Tymebank to test the distribution of its SIM cards at Tyme kiosks, making it easier for its clients to sign up for a new service.
TymeBank’s Strategy Is To Make It Simple and Cheap For Customers
Indeed, signing up to the digital bank could cost little or nothing. No documents are required and no charges demanded.
To open an account, you need a South African ID number and a South African cellphone number, which the bank verifies through several questions and a One-Time PIN (OTP).
If the process is done at a kiosk, biometric data will be captured and compared to the data with Home Affairs, which is connected to the Tyme systems, and a free Visa debit card is issued immediately.
If done online, you will have access to your account, but it will be limited in how much you can transact until you go to a kiosk and “upgrade” your account (for free) to a full account through capturing biometric data and registering your residential address.
Getting a debit card is free and immediately.
Service Fee for new registration is free. There is no monthly account or withdrawal at Pick n Pay and Boxer stores, only R2 at other major retailers.
By July 2019 Customers Can Borrow From TymeBank Without Collateral
TymeBank’s CEO, Sandile Shabalala, has also told analysts and investors that the digital bank would start piloting unsecured term lending in July and a credit card in partnership with consumer lending company RCS later in 2019.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.
