Capitec lays down the gauntlet to FNB

The expansion of Capitec’s business banking offering is set to bring the bank into direct competition with FNB.

While Capitec only offers one business account – regardless of size, type, or turnover – its offering clearly targets small and medium-sized enterprises (SMEs).

Capitec Business Banking executive Karl Kumbier said as much in the bank’s interim results presentation on 30 September, saying “we exist to help grow SMEs”.

With products like Entrepreneur accounts and pay-as-you-trade credit, Capitec has not been shy about its ambitions to take on the SME market.

Currently, this market is dominated by FNB. While Capitec boasts the largest client base of any bank in South Africa – now at 26.6 million – FNB has the most SME clients.

FNB’s Commercial segment serves entrepreneurs, SMEs, and growth enterprises – groups Capitec Business is also targeting.

In its 2026 financial year, FNB-owner FirstRand reported that the bank expanded its commercial client base by 2% to 1.38 million customers.

Of this total, 1.2 million are SMEs, representing 93% of FNB’s total commercial client base. This also makes SMEs an important revenue driver for FNB, generating two-thirds of its commercial earnings.

As South Africa’s oldest bank, FNB has been active in the commercial banking market since the 19th century.

However, its relaunched and revamped Business Account was introduced more recently, in 2012.

Its First Business Zero account, a dedicated zero-fee digital micro-business and sole-proprietor solution, was launched in 2019.

This gave FNB a significant headstart over Capitec, which only launched its own overhauled Capitec Business offering in 2023.

However, its late start has not held Capitec back. The bank already boasts 686,000 business clients, which includes merchants, entrepreneurs, and traditional business.

This total includes 237,000 entrepreneurs and 198,000 formal businesses, and Capitec plans to expand this base significantly in the coming years, particularly by drawing in more SMEs.

The bank has a clear advantage over its competitors in this regard, as its substantial client base enables it to cross-sell to millions of customers.

However, Capitec wants to go beyond its own client base and draw in clients from outside the bank, which will see the fight for market share in the SME market heat up in the years to come.

Capitec’s plan for SMEs

At a media roundtable following Capitec’s latest half-year results, CEO Graham Lee provided a breakdown of the bank’s existing business client base.

He said Capitec already has a “very significant mix” of business clients who were already personal banking clients and those who are new to the bank.

Lee further explained that, while Capitec’s vision is to grow its SME base, one of its strategies to do so is by attracting big businesses.

“In fact, we designed our business bank structures so that, when we started, we had people working on strategic accounts and bringing in big businesses,” Lee explained.

“The reason for that is that those big businesses very often are the support structures – their clients are the smaller businesses around them, and they are the employers of the people who bank with the personal bank.”

Capitec has also ensured that its business bank has a presence in various parts of the country, all with different support structures depending on the region.

“Across the country, we’ve got a couple of different, new support structures both in terms of how we serve as well as how we sell,” he said.

“We have people walking the streets going into pretty much every salon and spaza shop and tavern and people doing the shocks for Bolt drivers in every part of the country.”

While the bank also has branches in most of these areas, Lee said many businesses are simply unable to move outside of the areas in which they operate.

“They need to be at their own businesses, and we recognise that we need to be out in the streets serving them as well as the more traditional business bankers and the Relationship Suite,” he said.

Lee described Capitec’s Business Banking Relationship Suite as a call centre environment that is “very much focused on building one-on-one relationships” even though they are remote. 

He said this suite enables the business bank to scale the support of its digital model while also scaling the personal service that people have come to expect from Capitec.

“Because of that, we can help anyone from really tiny single-person entrepreneurs who are starting out for the first time to some really quite, quite significant corporate accounts,” he said.