African Rainbow Capital’s (ARC) TymeBank has become the first digital bank in Africa to break even and reach profitability.
TymeBank announced today that it reached its first month of profitability in December 2023, less than five years since launching in February 2019.
“This milestone marks a pivotal moment for South Africa’s only black-controlled bank, making it one of the fastest-growing digital banks globally and the first African digital bank ever to reach this milestone,” the company said.
“We are extremely proud of our achievement, particularly when you consider that globally, less than half of the top 100 digital banks are profitable,” said TymeBank CEO Coenraad Jonker.
He referred to a recent study which found that less than 5% of all ‘neo-banks’ worldwide had reached profitability.
“Having achieved our first month of profitable operations in a significantly shorter timeframe is a South African success story that our 8.5 million customers can share with pride,” Jonker said.
The bank attributes its success to several key factors, including its model of combining digital channels with in-store kiosks at major retailers. This model has allowed the company to consistently acquire approximately 150,000 customers monthly.
TymeBank chairperson Thabani Jali said, “On behalf of the board of directors and TymeBank’s leadership team, I must extend my gratitude for our investors’ continued faith in our vision and their commitment to our collective success.”
“Their trust in TymeBank’s team has been instrumental in driving us to this outcome. To appreciate their investment, we are committed to building a sustainable future that delivers a solid return on investment.”
ARC founder and chairman Dr Patrice Motsepe said this milestone comes after more than four years of “dedicated effort, strategic investments, and an unwavering commitment to the business’s core mission to offer quality banking services to all South Africans”.
“Having attracted more than 8.5 million customers, TymeBank’s unique proposition continues to digitally disrupt and transform the banking sector.”
“And as the business evolves, we are seeing it gradually appeal to more affluent consumers who appreciate its unrelenting innovation, customer-centric transparency and accessibility.”
Jonker said this achievement aligns the bank with its goal of becoming one of the top three retail banks in the country.
“This ambitious target is our next measurable benchmark for success, one that will require strategic focus across all areas of our business,” he said.
“However, we are confident that our proven track record of success positions us well to achieve this audacious aim in the next few years.”