TymeBank, a pioneering digital banking institution based in South Africa, has successfully amassed R4 billion (equivalent to approximately $222 million) in customer deposits. The bank has set its sights on expanding its operations to Indonesia by the end of 2024, marking its entry into the third Southeast Asian market. This strategic move follows its previous launches in the Philippines in October 2022 and in Vietnam in January 2024.
Upon its arrival in the Indonesian market, TymeBank has decided to initially forgo the pursuit of a full-fledged banking license. Instead, the bank will focus on introducing its lending service, known as Merchant Cash Advance, which is specifically tailored to cater to the needs of Small and Medium Enterprises (SMEs). This approach mirrors the strategy TymeBank employed during its expansion into Vietnam.
Coen Jonker, the chair of Tyme Group, expressed optimism about the venture as he highlighted the significant potential for profitability within the small business lending sector in Indonesia and the broader region. Jonker also noted that by concentrating on lending services, TymeBank can expedite the process of building its brand presence. He pointed out that acquiring a comprehensive banking license and establishing the necessary infrastructure is a more time-consuming and costly endeavor.
TymeBank was co-founded in 2018 by Coenraad Jonker and Tjaart van der Walt with a mission to serve the financial needs of low-income individuals and SMEs. The bank has garnered substantial financial backing from prominent investors such as Tencent, British International Investment, and Patrice Motsepe’s Africa Rainbow Capital (ARC). To date, TymeBank has raised a total of $316 million in funding.
Currently, the bank is in the process of securing an additional $150 million through a Series D funding round. Looking ahead, TymeBank has ambitious plans to make its debut on the New York Stock Exchange by the year 2028, as part of its long-term growth strategy.
Indonesia, with its vast population of over 60 million Small and Medium Enterprises (SMEs) and a notable gap in access to conventional financing options, represents a significant growth opportunity for TymeBank’s merchant lending business. The bank has a proven track record in South Africa, where it has successfully disbursed $100 million in loans to more than 60,000 small businesses, demonstrating its capability to support the SME sector effectively.
Despite its potential, TymeBank’s journey in Southeast Asia has not been without challenges. The company’s operations in the Philippines, for instance, reported a substantial loss of 2.47 billion Philippine pesos (equivalent to $42 million) in 2023, which marked its first full year of operations in the country. Nevertheless, Coen Jonker remains optimistic about the future. He has outlined a clear financial roadmap, with the goal for the company to reach a break-even point by 2025 and to achieve full-year profitability in its South African market by 2024.
Looking ahead, TymeBank has set ambitious customer acquisition targets. By October 2024, the bank aims to have expanded its customer base to 10 million in South Africa and 5 million in the Philippines. Jonker highlighted the rapid growth in the Philippines, noting that the bank managed to attract half the number of customers in just two years that it took six years to achieve in South Africa. This success story underscores the bank’s potential for scaling up in new markets.
TymeBank’s strategic focus is currently on the Southeast Asian market, which offers a conducive regulatory environment and a vast potential customer base. However, the bank is also keeping an eye on future opportunities in Africa. Jonker indicated that an expansion into the African continent is inevitable, framing it as a matter of timing rather than possibility, with the sentiment that it’s a question of “when and not if” TymeBank will take its operations to Africa.
