Tymbank launches new credit card

Last month TymeBank launched its first credit card. According to the TransUnion Industry Insight Report there are 6.9 million people that currently own a credit card in South Africa and now TymeBank wants to muscle in on this lucrative marketplace.

TymeBank claims that it’s entering the market with a competitive proposition for customers. But who is this new(ish) digital bank targeting the product at and is it as attractive as it says it is?

Middle income market

According to reports, TymeBank has set its sights on the middle-income market. Its own research that it has produced, to accompany its credit card launch, shows that most (63%) will use their credit cards on big purchases like appliances, furniture and renovations, while 46% will use to fund weddings, birthdays and funerals.

What do consumers look for in a credit card?

Low fees were the most important for 77% of people taking part in TymeBank’s survey, while 61% were keen on credit cards that offer a good loyalty programme. A competitive interest rate also ranked highly among 60% of respondents.

When asked what interest rate TymeBank offers on its credit card, a spokesperson said: ‘We charge all customers 18%, but only charge this interest if the monthly purchases are not settled in full. We strongly encourage customers to use their TymeBank Credit Card as a convenient and safe transactional mechanism, and to settle their outstanding balance in full each month.’

Interest free?

It’s possible for TymeBank customers to benefit from the digital bank’s interest free period offering. Customers enjoy up to 55 days interest free.

This means that if you’re savvy enough to note the date when the 55 days is up, you could benefit from paying no interest at all on the card if you pay in full before the 55 day interest free period is up.

The bank’s buy now pay later scheme – MoreTyme – also allows customers to make interest free purchases at its partners’ online and physical stores. Again, interest payments can be avoided if you pay in full before the interest free period ends.

A TymeBank spokesperson says this can be done by paying only 50% upfront and then paying the remaining 50% in two equal tranches after 30 days and 60 days.

How does TymeBank compare?

Just like its competitors, TymeBank charges fees on its credit card. At the time of writing, the FAQ section of its website reveals that customers must pay a once off initiation fee of R160, thereafter there’s a monthly free of R60 to pay.

Customers must be over the age of 18 and earn over R3,000 a month to qualify for the card. The card can be insured at R4.50 per 1,000. Payments and transactions can also be conducted via its app.

So how does it stack up against its competitors? It’s offering tends to undercut most banks’ interest rate charges on credit cards, which generally sit at the 21% mark. It’s not, however, unique with its 55-day interest free offering.

Most banks including Standard Bank, Capitec and First National Bank (FNB) offer 55 interest free days provided you pay in full.

Where it does fall short is that it doesn’t have its very own major rewards scheme in place whereas its more established competitors like Standard Bank and FNB can boast they have the recognisable Ucount and eBucks.

However, that’s not to say it hasn’t forged some partnerships where its customers can benefit from some perks. For example, customers can earn Pick n Pay Smart Shopper points whenever they swipe their card.

Double points can, however, be earned if you use your TymeBank card at Pick n Pay itself. Double Smart Shopper points can also be earned for every litre of fuel that they buy from a BP service station.

Earning Smart Shopper points can also be done for all online purchases and you again get double points if you use your card while shopping through Pick n Pay’s website.

TymeBank’s TymeAdvance

If you’re someone that makes use of pay day lenders, you may want to consider TymeBank’s TymeAdvance if it’s offered by your employer and undercuts your pay day lender’s offering.

A TymeBank spokesperson explains: ‘TymeAdvance allows employees at participating employers to access up to 50% of the salary they’ve earned at a given point in the month (up to R5000 per advance) for a flat fee of R30 and no interest.

‘The process to request an advance takes less than two minutes via USSD or App and requires no paperwork or bureau scores.

‘The amount advanced is automatically deducted off the employee’s salary at month end. This product allows customers to avoid expensive unsecured credit and unscrupulous payday lenders.’