African Bank partners with MMI Holdings to widen coverage
MMI Holdings and African Bank have entered into an agreement where the two companies will offer expanded financial services solutions to their respective customers.
MMI’s brands include Metropolitan, and Momentum.
The two companies will enter into mutually beneficially relationships on the following three fronts:
- African Bank will provide the capabilities to enable a credit (lending) solution to MMI clients, for distribution via MMI’s established sales channels. African Bank will be the exclusive provider of consumer credit products to MMI, for solutions falling within its product range.
- Over time, MMI’s full range of insurance products (appropriate to the relevant target market) will, on an exclusive basis, be made available to African Bank’s customer base through its branch infrastructure and other distribution channels at its disposal.
- African Bank will act as sponsoring bank to facilitate deposit-taking and extend transactional banking capabilities that MMI wishes to offer to its clients.
“For the lending solution, our plan is to build up a loan book in excess of R10 billion over the next five years. The plan for the insurance initiative is to build a distribution channel able to generate in-force premiums in excess of R1 billion within five years from inception of the venture. On both lending and insurance, profits will be shared 50/50 between the partners, the companies said in a joint statement on Monday.
The first phase of the insurance co-operative venture is expected to go live in the second half of 2017, with lending activities becoming fully functional during the first half of 2018.
The agreement is subject to regulatory approval.
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