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TymeBank, one of the world’s fastest-growing digital banks, has completed the R1.5-billion ($86.8 million) acquisition of Retail Capital, a leading fintech funder of SMEs, as part of its strategy to deepen its operations and expand its financial services footprint.
African Rainbow Capital (ARC) Financial Services Holding, a Black-owned and -controlled company that operates under Ubuntu-Botho Investments (UBI), a holding company founded by South African billionaire mining tycoon Patrice Motsepe, owns a portion of the South African digital bank.
TymeBank’s recent announcement comes after it received all necessary regulatory approvals to complete its acquisition of a 100-percent stake in Retail Capital in accordance with the definitive agreement it signed in August with the fintech company that provides funding to SMEs.
The digital bank stated that it will not rebrand Retail Capital because both will continue to operate as separate brands; however, the integration of the two companies will be completed by the end of December, and Retail Capital CEO Karl Westvig will become an executive in Tyme Group responsible for business banking and business lending.
Coen Jonker, CEO of TymeBank, commented on the transaction, which is the digital bank’s first acquisition since entering the retail banking space in 2015, stating that it marks the start of a new era for TymeBank as it expands into working capital funding for small businesses.
“TymeBank Business Banking is strengthened by a quality acquisition and a high-caliber team, and we look forward to making business banking and access to capital more affordable for South Africa’s small business owners and entrepreneurs,” he said.
Retail Capital’s lending expertise will be combined with TymeBank’s deposit base and operations to serve a larger customer base.
Over the last decade, Retail Capital has been able to lower the barriers to funding for SMEs through an easy, three-step online application process, and has provided funding totaling more than R5.5 billion ($326.3 million) to over 43,000 South African business owners, making it the largest SME funder of its kind in the sector.
