South African fintech startup TymeBank is on the brink of a $150 million Series D funding round as it aims to solidify its position as one of Africa’s fastest-growing digital banks. CEO Coenraad Jonker recently outlined the company’s ambitious plans, including a potential IPO and international expansion despite facing economic and operational challenges.
With its current valuation nearing $1 billion, Jonker aims to complete the Series D round by Q4 2024 to achieve unicorn status. This funding round, nearly double last year’s $77.8 million raise, would demonstrate strong investor confidence and support the bank’s aggressive growth strategy.
Jonker also envisions listing TymeBank on the New York Stock Exchange (NYSE) by 2028, with a secondary listing on the Johannesburg Stock Exchange (JSE), highlighting the bank’s commitment to global recognition while maintaining its South African roots.
The funds raised will be used to fuel expansion into new markets, particularly Indonesia by year-end, following successful entries into Vietnam and the Philippines, where profitability is expected within 18 months.
In December 2023, TymeBank achieved profitability, a rare feat among digital banks globally. This success is attributed to its blend of digital channels, in-store kiosks, and partnerships with major retailers, which have facilitated the monthly acquisition of 150,000 new customers.
Collaborations with industry giants like Pick n Pay, Boxer, The Foschini Group, and the Zion Christian Church have driven this growth. With over 8.5 million customers, 1,000 kiosks, and 15,000 retail points nationwide, these partnerships have significantly boosted accessibility and customer loyalty.
TymeBank’s offerings, such as affordable banking services, an 11% fixed deposit savings rate, and interest-free Grant Advance for social grant recipients, set it apart in the market. Partnerships like healthcare insurance with the National Healthcare Group further cater to diverse customer needs.
Read also: TymeBank Breaks Even: South Africa’s First Digital Bank to Turn a Profit After 4 Years.
The bank’s lending portfolio saw a 30% year-on-year growth, supported by products like Merchant Cash Advance, which benefits over 50,000 SMEs and contributes to economic development. It is now reportedly South Africa’s fastest-growing bank.
“We aim to be in the top three in customer numbers and from a return on equity perspective. Initial investor engagement encouraged us to consider raising a larger round to accelerate the pursuit of further attractive opportunities in the industry,” Jonker told Bloomberg.
Looking ahead, TymeBank is focused on expanding its mission of providing accessible banking services. Chairperson Thabani Jali and major shareholder Dr. Patrice Motsepe have expressed optimism about the bank’s future. Backed by $300 million from investors like Tencent, British International Investment, and Apis Growth Fund II, TymeBank is well-positioned for continued growth.
TymeBank’s journey, from its 2019 launch to profitability and rapid expansion in digital banking, demonstrates resilience and foresight. The upcoming Series D funding, IPO preparations, and international expansion underscore its commitment to growth and vision to rank among South Africa’s top three retail banks.
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