South Africans have an estimated R300 billion in Krugerrands hidden in drawers and safes, unaware that they could be using the value of their gold to fund day-to-day financial transactions.
FinTech, Troygold, allows gold owners to upload and digitise their physical gold and then use it for transactions and finances. Customers receive an ownership certificate and can then save, spend and borrow against their gold bullion via a mobile app and Mastercard debit card. The gold storage and insurance are free of charge.
Troygold was co-founded by brothers Bastiat and Dane Viljoen.
“Gold is history’s most stable money in terms of maintaining its value and purchasing power over time. Krugerrands used to be stored at safety deposit boxes in bank branches, but frequent robberies made the practice too risky and banks stopped offering the service,” CEO Bastiat explains.
“Most South Africans who own gold Krugerrands are stashing these at home in safes and drawers, which is a security risk. Troygold offers a superior solution where owners maintain full legal ownership of their Krugerrands, but with security at no charge and easy access to increased financial liquidity.”
The process is simple: download the app and deposit your Krugerrands by taking them to your closest drop off point like Scoin Shops or if you have more than 20 coins, Troygold will arrange for secure collection. Using the Troygold mobile app, you can then trade any amount of gold 24/7, offering instant liquidity on your gold holdings.
The physical gold is denominated in Rands, which is loaded onto a Troygold Mastercard linked to a physical cheque account at Access Bank, the sponsoring bank. If you don’t want to sell your gold, you enjoy a gold loan facility to allow you to utilise the value inherent in your gold holdings without selling your gold.
“Troygold account holders can instantly access cash by way of a loan facility to the value of 75% of their gold holdings. The funds in the loan facility can be spent anywhere Mastercard is accepted or the value can be transferred to another bank account,” says Viljoen.
There are no monthly account fees with a Troygold account but there are standard transactional fees associated with the Troygold Mastercard. The gold-backed loan facility has monthly interest rates from as low as 1.25%.
All customer holdings are fully insured against loss or theft and gold holdings are audited monthly. Troygold’s technology gives each gold coin a unique identity number when it is added to the vault storage so that ownership is never in question.
“Gold has outperformed the Rand by an average of 14% each year over the last 50 years, according to an Old Mutual study. As our currency continues to lose value, the benefit of storing, transacting and growing your wealth in real gold is a no-brainer,” says Viljoen.
Troygold is currently only available in South Africa, but the company plans to expand internationally. Crossfin Ventures (which includes co-investor Investec) has invested in the business.
Troygold is registered as a Krugerrand dealer with the South African Financial Intelligence Centre (FIC) of the South African Reserve Bank (SARB). It is also a registered credit provider with the National Credit Regulator and an appointed juristic representative for financial services provider, Prime Advisory Services.