Discovery Bank continued its excellent progress, including a 49% increase in clients, a 67% increase in net income, and a 36% increase in retail deposits.
Discovery Bank launched on 14 November 2018 and is marketed as the world’s first fully digital behavioural banking platform.
It uses Vitality Money to incentivise banking clients to make healthier financial decisions and work more responsibly with their finances.
Vitality Money can be used on rewards like a dynamic interest rate increase, getting up to 100% back on HealthyFood, and a 75% discount on HealthyCare.
The Discovery Bank app also rewards users for spending their money responsibly with Vitality Active Rewards.
Discovery CEO Adrian Gore previously said Discovery Bank is expected to grow to 700,000 clients by 2024, which is projected to be their breakeven point.
However, the digital bank performed much better than expected and achieved this milestone ahead of the target.
Discovery revealed that Discovery Bank increased its user base by 49% over the last year to over 700,000 clients. It grew accounts by 59% to 1.6 million.
It has delivered on the medium-term target of averaging 1,000 new clients daily from January to June 2023. It was 50% higher than the equivalent prior year period.
Gore said Discovery Bank is performing ahead of expectations and is on track to meet its target of 1 million clients by 2026.
It is not only subscriber growth which was better than expected. Discovery Bank’s operating loss was 23% better than the prior year.
The operating loss before new business acquisition costs was 39% better than the prior year, as growth exceeded expectations.
Advances have grown steadily, given increased credit application volumes and card usage.
Discovery Bank’s share of new credit issued was 15.7% of credit card facilities in the second quarter of 2023, up from 10.9% the prior year.
The bank also maintained excellent customer service levels, which culminated in it winning the coveted MyBroadband Best Digital Bank 2023 award.
The good news for investors is that Discovery Bank is expected to reach breakeven earlier than initially forecasted.
“We would like to break even operationally by the end of this calendar year. It is a tough call, but I think we will make it,” Gore said.
He added that they are confident they will reach total breakeven by 2024. “The bank has been performing well ahead of plan,” he said.
Discovery Bank performance
The charts below show Discovery Bank’s exceptional performance over the last few years.