Michael Jordaan’s Bank Zero puts its systems through its paces ahead of debut

Bank Zero, the mobile app-based bank co-founded by celebrity banker Michael Jordaan, has begun the final round of testing its facilities before its launch in the second half of 2019.

Known as beta testing (which is the concluding stage of testing before a commercial launch), the new bank says it is processing payments and debit orders, as well as doing transactions for prepaid services such as airtime, data and electricity. It does not specify when it will launch, or when this round of testing will be completed.

“SA is a world leader in electronic payments yet customers seldomly experience this power, as it requires a modern core banking system to leverage this,” says Jordaan, its chair and co-founder. “It’s exciting that all staff are part of this first wave of beta testing.”

Bank Zero is already considered a “clearing bank” and “settlement bank”, meaning it can receive transfers from other banks, using the branch code 888000. When this round of testing with staff is completed, external volunteers will be invited to participate in the trial.

“Sweat equity is our strategic advantage,” says Jordaan. “It transforms deep and diverse banking insights and know-how into powerful intellectual property. For example, having a single view of the customer is vital, yet banking excellence is also about having a single end-to-end view of money. This is the science of banking.”

Yatin Narsai, the CEO and co-founder, says the bank has prudently used its capital to plan how it will provide services. “This approach enables us to bring a revolutionary new core banking system to market with pervasive encryption and digital scaling. It is fundamental to our low-cost, high-capability offering,” he says.

Instead of buying off-the-shelf systems for both core and back-office functions that are designed for traditional banks, Bank Zero has built its own technology, including extra security for common fraud attacks like phishing.

Among the features it says it will offer are a new “check account” that replaces “old notions of cheque/current accounts and other legacy-style accounts”. This account will provide real-time checking and money control, as well as detection of rogue debit orders. The bank hopes to foster a savings culture and will also offer businesses integration with cloud-based Xero accounting software.

Yatin says it will offer its own patented card technology, as opposed to traditional card offerings. “The ubiquitous card has dominated spending for decades, but this ‘a card is a card’ approach is strategically flawed. Bank Zero will bring advancements and convenience by focusing specifically on security and control. The trauma of card skimming, and other rogue methods of recording card details, will be a thing of the past at Bank Zero. The alarming trend of rogue online stores bypassing OTP-based security will also be prevented.”

He adds that the 16-digit card number will not need changing when a card is replaced, so card details for digital services (such as Netflix or Uber) will not have to be reset. Customers will be able to make QR payments through platforms such as Zapper or SnapScan, as well as mobile-based NFC (near field communication) payments. “A card is never just a card at Bank Zero,” he says. “Why shouldn’t banking be a joyful, exciting and safe experience? After all it’s your money.”

• Shapshak is editor-in-chief and publisher of Stuff magazine.