Tymebank Gets Green Light to Buy Retail Capital

Tymebank Gets Green Light to Buy Retail Capital

The Competition Tribunal announced yesterday that it had unanimously cleared TymeBank’s acquisition of fintech SME funder, Retail Capital, in order to strengthen its business banking capabilities. TymeBank, which is owned by African Rainbow Capital (ARC), announced in August that it has struck an agreement with Retail Capital and its shareholders to acquire 100% of the shares of the fintech SME funder, pending regulatory approval.

The acquisition, according to TymeBank CEO Coen Jonker at the time, will see Retail Capital become a division of the bank and the cornerstone of its enlarged business banking offering. The investment in TymeBank increased in value from R1.1 billion at the end of 2021 to R1.4 billion at the end of 2022, a 13% rise.

The Competition Tribunal said in a statement yesterday that it had unconditionally approved the massive merger, in which TymeBank seeks to buy out Retail Capital’s whole issued share capital. After the merger, TymeBank will have complete control over Retail Capital, according to the competition watchdog.

“The Commission found that the proposed transaction is unlikely to result in a substantial prevention or lessening of competition in any relevant markets. The Commission further found that the proposed transaction does not raise any public interest concerns,” it said.

Through a three-step online application procedure, Retail Capital aims to remove the obstacles to borrowing for SMEs. Over the past ten years, it has given over 43 000 business owners in South Africa access to over R5.5 billion in working capital.

TymeBank is a digital bank that makes use of technology in order to simplify and lower the cost of banking. The bank’s main goal is to attract consumers who want to take advantage of lower banking fees and better customer service.

According to the regulator, TymeBank can now provide customers with personal and commercial transactions, savings accounts, and value-added services like death insurance, prepaid and health insurance, and credit card services.

“This acquisition will enable TymeBank to expand its offering to entrepreneurs to include working capital finance,” said Jonker.

“Retail Capital has acquired significant risk management experience over the past decade and through different economic cycles. “They have an experienced team in place and their risk models and operational processes have been battle-tested and optimised to a significant degree for small-business funding.”