It is easy to be sceptical when a CEO resigns to "spend more time with his family". It is often a polite way of saying he was dismissed. But in the case of Sandile Shabalala at TymeBank I think we can take it at face value. Shabalala’s strength is in business and corporate banking. He doesn’t fit into the mould of a computer geek starting a fintech.
And TymeBank must have been quite a culture change after Nedbank: the large banks have armies of people to do the heavy lifting.
New boss Tauriq Keraan fits more neatly into the fintech mould, having worked with digital banking for more than 10 years as a consultant at Deloitte.
Nobody can say Shabalala was falling behind: TymeBank is bringing in more than 110,000 new customers every month. At the same time, it has been extremely conservative in
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granting loans and fewer than a dozen have been issued so far.
TymeBank now has 630,000 customers, well ahead of Discovery Bank, which has barely 10,000, and Bank Zero, which hasn’t even launched. TymeBank has solved the single largest problem faced by digital banks — cash handling. It allows free deposits and withdrawals at Pick n Pay or Boxer. In a supermarket chain, cash is part of life, whereas banks these days tend to treat cash as an embarrassing nuisance.
In contrast, Discovery Bank points you to the other bank ATMs, which its customers can use at a high charge.
Other transactions at TymeBank cost either R2 or R4.
Nobody can say Shabalala was falling behind: TymeBank is bringing in more than 110,000 new customers every month
But Discovery Bank’s charges can’t be that low because it has to pay for the incredibly expensive SAP-based core banking system it introduced.
CEO Barry Hore got used to working with big budgets during his time at Nedbank in the swashbuckling Richard Laubscher era, which ended in 2003.
However, customers won’t pay much if they earn enough Vitality points and there’s plenty of app functionality to enjoy even for those who don’t make the top tier.
Hore was a good choice to start the bank, in spite of his history during the controversial Laubscher years. But it needs a more client-centric leader now. In this context, the appointment of Francois Groepe as deputy CEO is puzzling.
Marketing flair required
As former deputy governor of the Reserve Bank he would have a huge amount to contribute to the Discovery Group’s governance and risk management. But in the bank itself, Discovery needs a seasoned commercial banker with some marketing flair — one thinks of Absa’s Arrie Rautenbach or Nedbank’s Ciko Thomas.
Unless, of course, group CEO Adrian Gore plans to do all the marketing himself, Bill Gates-style.
So far Discovery Bank has been an anticlimax, perhaps because "onboarding" of customers has been so slow.
Though Bank Zero still hasn’t launched, the market has to take it seriously as the founders built a good digital platform at FNB. Chair Michael Jordaan is a consummate sultan of spin, while his former FNB colleagues Yatin Narsai and Lezanne Human are genuinely passionate geeks. Its overheads are tiny. It has borrowed some office space from one of its investors and plans to do without human interaction altogether.
It’s aiming for the small business market, where margins are higher than personal banking. It should appeal to technophiles but the product set will be small. Bank Zero has no plans to offer loans and as the last to launch it has a lot of catching up to do.
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