South Africa’s banking industry is expected to see a major shake up this year, with a number of new rivals set to take on the ‘big five’ of Capitec, Nedbank, Absa, FNB and Standard Bank.
While some of these new entrants – such as the upcoming offering from Discovery – are expected to act as a direct competitor, other banks such as the Patrice Motsepe-backed Tyme Digital, and Michael Jordaan-founded Bank Zero are expected to play more in the digital space.
Little has been said on when these new banks will officially be launching in South Africa, with all three giving a tentative late 2018/early 2019 release date.
However through regular updates on Twitter and other platforms Jordaan has indicated that steady progress on Bank Zero is being made, with a tweet on Friday (22 June) stating that the installation of the group’s mainframe was currently in progress.
In a statement in January, Bank Zero said it will make use of a mutual bank licence, which mirrors current social media trends and benefits customers by allowing for the support and creation of financial communities.
Mutual banks, or mutual savings banks, are banks that typically operate without capital stock, and is owned by its members who subscribe to a common fund.
This, the bank said, will provide for a capital-efficient framework, and Bank Zero will be sharing the subsequent cost benefits with its customers (both businesses and individuals).
“Facebook, WhatsApp, Twitter and Instagram are the new normal for societies,” Jordaan said at the time.
“Why shouldn’t banks also innovate in this era of wider connectedness whilst still ensuring a robust banking value proposition? Bank Zero is addressing these realities, while employing cutting-edge technologies and delivering state-of-the-art security.”
Co-founder Yatin Narsai, who will also serve as Bank Zero’s CEO, said the group will use mobile technology and other innovations to give more financial transparency and control to customers “in an intuitive, secure and affordable way”.
“Coupled with the mutual banking concept, this will help nurture a savings culture in South Africa. New technologies, together with tried-and-tested account features like chip-and-pin cards, will deliver real value to our customer,” he said.
— Michael Jordaan (@MichaelJordaan) June 22, 2018