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Digital bank time. One of the newest banks here in South Africa’s banking block has announced a new deal with The Foschini Group, or TFG, which promises growth. The deal will see TymeBank roll out its banking products and services across 600 kiosks in the retail stores owned by Foschini, starting with Jet next month.

We’ve got TymeBank CEO Tauriq Keraan to talk to us about this deal. Tauriq, thanks so much for your time – no pun intended. You presently have 3.8 million customers. What are you hoping that this deal will do to your customer base?

TAURIQ KERAAN: Fifi, thanks for having me. There are a number of benefits that the partnership will bring synergistically to both partners. So on our side TFG provides massive reach. It has a physical store network in South Africa that exceeds 2 500 points and that will constitute stepwise growth for us as a business. As importantly, the reach actually spreads over a diverse set of LSMs [living standards measures], and that will support our agenda to diversify our customer profile as well, because we have an under-representation in higher LSMs.

And then lastly it provides us with an opportunity to diversify income streams, given their incredibly large loyalty base, as well as the active credit account base which provides us with the perfect opportunity to lend responsibly into that base.

But I think most importantly, here are two organisations in different sectors that believe very strongly, with full conviction, in a banking proposition that serves the needs of all South Africans and can be delivered in an integrated fashion in this physical retail journey, as I call it.

FIFI PETERS: This is kind of a similar related model that you followed with the likes of Boxer and Pick n Pay. I’m just wondering if now the new tie-up with The Foschini Group is testament that that actually works in growing customer numbers?

TAURIQ KERAAN: Fifi, we are a fully regulated bank, so our proposition works much as any banking proposition. You can wire your salary into the account, you can transact in any other way and so on. So we are retail-agnostic. Our partnership with Pick n Pay and Boxer is not only very strong, but very special to us, because it was our first partnership that allowed us to solidify ourselves in the market.

The relationship with TFG is somewhat similar, but I think provides us with perhaps greater opportunity to get into the lending space. So the partnership I see as really about expansion, not substitution in any way.

FIFI PETERS: You are starting off with 600 kiosks spread across the various TFG stores. I see that TFG however has 4 600 stores or so, so I’m just wondering at what point you consider ramping up … the number of kiosks you’ll be setting up?

TAURIQ KERAAN: As I mentioned, speaking for the South African market alone, they’ve got over 2 500 physical stores. So we’ll start off with 600 kiosks, which we will use to onboard customers on a TymeBank/TMG co-branded account. Those customers will have a co-branded debit card as well. And then I think it’s a matter of assessing the economics of that arrangement, as well as the impact and the benefit that it has had for customers, before we make a call to expand further. But the opportunity certainly exists. That’s number one.

Number two, we must always remind ourselves that even though TFG has a very prominent physical store network, they are becoming increasingly active in e-commerce and, in fact, have a very large online business as well.

So we are also looking at means of collaborating on the digital side of things.

FIFI PETERS: All right Tauriq, we’ll leave it there. Thanks so much for joining us. Tauriq Keraan is the CEO of TymeBank.

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