The Competition Commission has approved the merger of African Rainbow Capital (ARC) subsidiary, NewCo, and the Commonwealth Bank of South Africa (CBSA) – which owns TymeDigital.<\/p>\n
ARC which is tied to billionaire Patrice Motsepe\u00a0is moving to acquire the 90% stake in TymeDigital that will give it full ownership of the group.<\/p>\n
The Competition Commission has now recommended that the deal be approved without conditions.<\/p>\n
The acquisition comprises TymeDigital in South Africa and the related intellectual property and patents. Following the finalisation of the acquisition, ARC may consider introducing new shareholders in the current structure, which may include management, it said in August.<\/p>\n
CBSA and Tyme currently provide a limited range of banking services such as money transfer, TYME Coach and Merchant Advance in South Africa.<\/p>\n
Its predominant offering in this space is money transfer which is available in every Pick n Pay store nationwide.<\/p>\n
According to the commission, Tyme intends to expand its product offering through services such as personal accounts, goal saving, unsecured term loan, credit card and TYME Connect.<\/p>\n
CBSA and Tyme currently have a banking licence issued by the South African Reserve Bank which allows it to operate a bank through which the merged entity will be able to offer the aforementioned banking products.<\/p>\n
“The commission found that the proposed transaction is unlikely to result in a substantial prevention or lessening of competition in the relevant markets.<\/p>\n
“Further, the commission found that the proposed transaction does not raise any employment or other public interest concerns,” it said.<\/p>\n
With Competition Commission approval, the acquisition is still subject to approval by the Prudential Authority of the South African Reserve Bank.<\/p>\n
TymeDigital is a registered South African bank with a strong fintech focus and has been trialling its operations in South Africa as it works towards an official launch “before the end of the year”.<\/p>\n
It aims to provide affordable and accessible banking services through a growing network of partners, including Pick n Pay, its leading distribution partner with 750 Pick n Pay and Boxer stores.<\/p>\n
Targeted client segments include unbanked and underserved clients as well as small and medium enterprises.<\/p>\n
Competitive technology allows the bank to on-board clients with greater ease relative to its competitors and keep bank charges more affordable than what SA banking clients pay in general.<\/p>\n
The group used to be part of Commonwealth Bank of Australia\u2019s international financial services division, which was discontinued in the latest financial year. CBA acquired SA fintech company Tyme (take your money everywhere), in 2015.<\/p>\n
In the latest\u00a0SARB annual bank supervision report for 2017, the bank was listed as having R1.4 billion in assets in South Africa as at December 2017.<\/p>\n