Personal-Finance

TymeBank adapts for wider range of clients

2019-12-15 14:27

After nine months of trading, TymeBank announced that it had welcomed 1 million customers. Of these, approximately 45% (450 000) transact once or more a month.

Although the bank’s main customer focus has been lower-income earners, nearly half of its customer base earns more than R5 000 a month and 45% are older than 35.

Even for higher-income earners, or older customers who may be less tech savvy, TymeBank’s appeal has been the ease of opening an account, zero monthly fees and high interest rates paid on deposits.

This has created a demand for more functionality on the account, which, until now, has been limited. For example, until a week ago, a TymeBank customer could not use their card to do online shopping. The bank was also not able to provide proof of payment for electronic funds transfers.

Cheslyn Jacobs, head of sales and service at TymeBank, says the aim of the bank when it launched was to bank lower-income customers.

“We designed for the 80%, not the 0.1% of customers,” explains Jacobs, who says that, for most of the bank’s target market, online shopping was not a requirement. However, its low-cost, easy application features have attracted a far wider range of income earners, resulting in a demand for more user functionality.

The bank was able to establish e-commerce ahead of Black Friday and Cyber Monday for local online shopping, however, it is still waiting for a licence from the SA Reserve Bank to approve foreign online purchases from places such as Amazon.

“From a technical perspective, we use the same system as for local transactions, so once we have the approval, it will just be a matter of switching on for international shopping,” says Jacobs.

The bank is now able to provide proof of payment for transactions, which can also be applied to historical transactions. Unlike its competitors, TymeBank does not charge a fee if you want proof of payment.

Even for higher-income earners, or older customers who may be less tech savvy, TymeBank’s appeal has been the ease of opening an account, zero monthly fees and high interest rates paid on deposits.

In line with its customer demographics, the TymeBank app has only been available on Android and not the Apple iOS platform.

“Apple users are very big on social media, where they have been requesting an app. There is also a big secondhand market for Apple phones. It is on our road map, but not immediately,” says Jacobs, who adds that Apple users have still been able to use online banking, which has the same look and feel as the app.

The focus for the bank at this stage is to provide mobile banking via USSD functionality within the next few weeks. This was another lesson learnt by the bank – although penetration of smartphones is growing, many of its target market do not have a smartphone and are unable to use either internet banking or the app.

Most of the glitches around debit orders have been resolved. Jacobs explains that, initially, some payment providers were slow to incorporate TymeBank into their debit order systems. Where delays were evident, it raised the issue with the merchant’s bank.

Next year, TymeBank will be launching personal loans. In line with its goal of providing cost-effective banking, there will be no monthly service fee on loans, and a flat initiation fee below the maximum allowed by the National Credit Act. The bank will also be launching a small business proposition for sole proprietors next year. Jacobs says a sole proprietor will be able to open an account in minutes and immediately receive a bank card with the company name embossed on it.

TymeBank Fees:

Fee structure of free, R2, R4 or R8

Free transactions

. No monthly fee

. Card purchases

. Airtime/data

. Electricity

. Cash withdrawals at Pick n Pay or Boxer:

R2 fee

. Cash withdrawal at another retailer

. Debit order

. Electronic payment to another bank:

R4 fee

. Cash deposit at Pick n Pay or Boxer:

R8 fee

. Withdrawal from an ATM is R8/R1 000. For example, you will pay R8 up to the first R1 000, R16 for R2 000 and R24 for R3 000

With the high interest rate, starting at 6%, combined with Smart Shopper loyalty rewards, Jacobs says 90% of customers receive more back in rewards and interest than they spend on bank fees.


Maya Fisher-French
Personal finance journalist
City Press
p:0117139001
w:www.mayaonmoney.co.za  e: maya@askmaya.co.za
      
 
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January 26 2020