Massive growth for Capitec – South Africa’s leading digital bank
Capitec experienced massive growth in its earnings and active client base for the financial year ended 29 February 2024.
Capitec CEO Gerrie Fourie attributed this incredible growth to Capitec’s investment in its systems, innovative payment solutions, and three new business units.
“This growth aligns with the bank’s strategy of shifting the market towards digital banking while maintaining a competitive advantage through branch service delivery,” said Fourie.
“Over the last three years, we’ve invested R6.3 billion in re-platforming our systems and migrating our data to AWS Cloud services, developing innovative payment solutions, and building three new businesses to unlock value for our 22 million clients.”
“This cemented our position as the country’s top digital bank and produced strong results in a challenging economic environment,” said Fourie.
Massive growth
Capitec’s earnings grew by 16% to R10.6 billion, and the Group’s earnings grew by a massive 25% in the second half of the financial year ended 29 February 2024.
This impressive growth was thanks to its diversified businesses, with non-interest income now contributing 72% of its total income.
Capitec’s strong growth didn’t stop there, though. Its active client base grew by 10% to 22 million, and its app user base grew by 19%.
Transaction volumes then increased by 21% to 9.9 billion, while transaction and commission income grew by 29% year-on-year to R14.8 billion.
South Africa’s leading digital bank
Fourie attributed this substantial growth to Capitec’s future-focused strategy, which aligns with the customer trend of shifting from branch-based service and cash-based transactions to self-service and digital banking.
Capitec’s app increased its user base by over 180,000 per month and registered over 11 million daily logins – equal to over 500,000 people using the app every hour.
This enabled its branches to focus more on service delivery and selling its more complex products.
“We have over 2 trillion data points, which helps us anticipate our clients’ needs, develop better products, and communicate with our clients in a more relevant way,” said Fourie.
Capitec businesses thriving
During the same period, the Capitec Group’s other businesses have also been thriving.
It rebranded Mercantile Bank to Capitec Business, and it delivered a whopping R478 million in profit after tax – a 23% increase year-on-year.
This growth was attributed to the bank’s move to a new online banking platform and a single Capitec app for business and personal banking, as well as the implementation of cloud-based banking, CRM, and lending solutions.
“We strive to offer digitally-led, relationship-based business banking accessible to all South African businesses, big or small,” said Fourie.
Capitec Insurance also gained significant market share, with active funeral policies growing by 23% and now covering over 20% of South Africa’s population.
