SA’s digital banker TymeBank pays R1,5 billion to acquire Retail Capital

One of South Africa’s growing digital banks, TymeBank has announced the finalisation of the acquisition of Retail Capital as the banker intensifies plans to take on business banking giants.

Media reports filtering through to BusinessTech Africa indicate that the Patrice Motsepe-linked banking institution had announced it wanted to take over Retail Capital in August.

Known as a small-business lender, Retail Capital will now see TymeBank having access to its more than 43 000 credit customers as the banker paid TymeBank paid R1.5 billion for the transaction.

“[It’s] the beginning of a new era for TymeBank as we branch out into working capital funding for small businesses,” said TymeBank CEO Coen Jonker.

“TymeBank Business Banking is strengthened by a quality acquisition and a high-calibre team and we look forward to making business banking and access to capital more affordable for South Africa’s small business owners and entrepreneurs.”

After obtaining all the necessary regulatory approvals, Retail Capital has now officially started the work to become TymeBank’s new division.

The bank said it should complete the integration of the two companies before the end of December, which will see Retail Capital’s CEO, Karl Westvig, becoming a Tyme Group executive accountable for business banking and business lending respectively.

However, it is reported that TymeBank will not take steps to rebrand Retail Capital as yet and the duo will continue to operate as two separate brands.

For TymeBank, this is registered as the first major acquisition since making its entry into the retail banking space in South Africa, thus disrupting the industry with its no monthly-fee offering, which set the tone for most customers.

This website has discovered that TymeBank’s Business Banking division that Westvig will lead already boasts more than 120 000 customers with transactional business accounts, providing a solid base for Retail Capital to grow its credit customers.

The lender has already provided credit to more than 50 000 business owners in the past decade, with over R7 billion in working capital disbursed.

Meanwhile, TymeBank might also look at converting many of Retail Capital’s credit clients to its transactional banking clients – it also announced that it’s on track to reach 6 million customers in December.