Bank Zero co-founder and venture capitalist Michael Jordaan says the neobank is weighing its options around the introduction of crypto-currency transactions, as part of its long-term plans.
Jordaan was speaking at the ThinkBig series webinar hosted this morning by financial services company PSG.
Speaking to TV news anchor Alishia Seckam about the future of digital banking and telecoms in SA, Jordaan, who is a principal South African investor in crypto exchange VALR, shared his thoughts on the regulation of crypto assets in SA.
He noted crypto-currencies and blockchain open a world of opportunities for new business models, adding he anticipates there's still going to be a lot of disruption from the emerging industry in future.
When asked about the possibility of a tie-up between his ventures, VALR and Bank Zero, to offer crypto-currency offerings, he noted that while there are no collaboration plans between the companies in the initial term, Bank Zero does have crypto on its radar.
“The way I operate my start-ups, is to make them completely independent. For start-ups to succeed, they need focus – and it’s taken an incredible amount of focus at Bank Zero, just to get things right. Will there, in time, be opportunities with crypto or blockchain?
“I definitely think there will be participation in it. And it will most likely have something to do with payments abroad and back. You only have to make one Bitcoin payment once, to see how easy it is, and to understand the power of crypto-currencies as something that doesn’t recognise international borders,” he explained.
Bank Zero launched to the public in 2021, after numerous delayed launches. The newcomer to the South African digital-only banking market was first announced in 2018, after its co-founders, Jordaan and Yatin Narsai, were granted a mutual banking licence by the South African Reserve Bank.
The digital bank says it is not yet disclosing the number of customers it has on-boarded to date.
Jordaan, who is the former CEO of First National Bank (FNB), noted the move to regulate crypto assets has been good news for VALR, with the crypto exchange introducing several investment products.
“I've been dabbling in crypto ever since 2013 when I was introduced to it. When Bitcoin came about, I was fortunate to have been one of the early adopters and I never knew that the price would go up that much. I think the technology is very interesting because it allows many new business models and it makes offshore payments much easier than anything the banks can come up with.”
According to Jordaan, FNB’s eBucks became the world's first bank-backed digital currency when it launched in 2000 under his leadership.
"The interesting thing is that when we initially launched eBucks, we launched it as a crypto-currency. The very first advert said it is the ‘world's first e-currency’ issued by a bank. And then we got a rap over the knuckles issued by the central bank at the time, saying we are not allowed to issue a currency – only the central bank is allowed to do so.
“But that opened a possibility in my mind that currencies don't only need to be issued by the central banks; they can come from any place where you have faith or trust.”
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