{"id":824971,"date":"2025-05-22T07:00:00","date_gmt":"2025-05-22T05:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=824971"},"modified":"2025-05-21T16:23:10","modified_gmt":"2025-05-21T14:23:10","slug":"tymebank-is-going-for-capitecs-gold-mine","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/banking\/824971\/tymebank-is-going-for-capitecs-gold-mine\/","title":{"rendered":"TymeBank is going for Capitec’s gold mine"},"content":{"rendered":"\n

TymeBank, in partnership with Sanlam, will soon start offering unsecured personal loans, entering the field dominated by Capitec.<\/p>\n\n\n\n

Sanlam and TymeBank Limited have entered into an agreement, which will result in establishing a joint venture (JVCo) focused on unsecured personal loans with an embedded credit life offering.<\/p>\n\n\n\n

Sanlam Personal Loans (SPL) already provides personal loans of between R5,000 and R300,000 to qualifying individuals on repayment terms of 1 to 6 years at a fixed interest rate, with a loan book value of R5 billion.<\/p>\n\n\n\n

Unsecured loans are generally high-risk, high-reward for financial service providers, as they often charge higher interest rates, but come with increased credit risk. <\/p>\n\n\n\n

The sector is dominated by Capitec, which started out as a micro-financer in the early 2000s. Several other financial service providers, namely Old Mutual and African Bank, also operate in the space.<\/p>\n\n\n\n

The embedded credit life offering built into the loans will also ensure that the debt is covered if a borrower cannot pay due to death or disability.<\/p>\n\n\n\n

Sanlam said that the collaboration with TymeBank is an essential component of its overall credit strategy. The two companies have complementary customer bases and skill sets.<\/p>\n\n\n\n

It also said that TymeBank has a robust IT infrastructure and bank-grade fraud and anti-money laundering capabilities, which should enhance Jvco’s credit strategy.<\/p>\n\n\n\n

Sanlam and TymeBank will jointly develop a new lending capability on TymeBank’s infrastructure. The bank is an expert in developing technological solutions and digital strategies.<\/p>\n\n\n\n

The Proposed Credit Transactions will access both Sanlam and TymeBank’s customer bases, enabling cross-selling opportunities.<\/p>\n\n\n\n

It added that scale benefits will support a competitive unsecured lending offering under the Sanlam and TymeBank customer-facing brands.<\/p>\n\n\n\n

Granted, suspensive conditions and completion deliverables have been completed. The longstop date for implementing the Proposed Credit Transaction is 31 March 2026.<\/p>\n\n\n\n

Working together already <\/strong><\/h2>\n\n\n
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Sanlam and TymeBank already have strong connections after Sanlam Life acquired a 25% interest in African Rainbow Capital Financial Services Holdings (ARC FSH), which holds an effective 46% in TymeBank.<\/p>\n\n\n\n

ARC FSH is the company that Ubuntu-Botho Investments (UBI) indirectly holds for its financial services. TymeBank is is ultimately controlled by UBI, Sanlam\u2019s strategic empowerment partner.<\/p>\n\n\n\n

TymeBank, which launched in 2019 and rapidly expanded to over 11 million customers, reached profitability in late 2023, making it the first digital bank in Africa to do so.<\/p>\n\n\n\n

The creation of JVCo will see the existing SPL Loan generation business, excluding its retail credit loan book, sold to JVCo in exchange for the issue of JVCo shares.<\/p>\n\n\n\n

TymeBank will acquire the remaining 50% of the JVCo from SPL for R31.5 million.<\/p>\n\n\n\n

The price of the SPL loan book shall be roughly R400 million plus the capital value thereof.<\/p>\n\n\n\n

TymeBank will receive a preference share, which will target 50% of the credit life profits, as per the terms set out in the subscription agreement.<\/p>\n\n\n\n

The subscription price payable by TymeBank to SPL for the Reference Share shall be roughly R320 million.<\/p>\n","protected":false},"excerpt":{"rendered":"

TymeBank, through an agreement with Sanlam, is entering the unsecured personal loans space, which is dominated by Capitec. <\/p>\n","protected":false},"author":95,"featured_media":742671,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[961],"tags":[14081,1798,1110,2880],"class_list":["post-824971","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-banking","tag-arc","tag-capitec","tag-old-mutual","tag-sanlam"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/824971","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/95"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=824971"}],"version-history":[{"count":7,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/824971\/revisions"}],"predecessor-version":[{"id":825087,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/824971\/revisions\/825087"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/742671"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=824971"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=824971"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=824971"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}