I imagine the banking business is a tough nut to crack, especially when there are already four names South Africans have become familiar with over the years.
Props to Capitec then, who have shown such growth over the past few years that they’re now playing in the big leagues. Absa, FNB, Nedbank, Standard Bank and now a fifth joining the party. Here’s Business Tech with how they did it:
…with its latest financial results, Capitec shows that even though it’s not a full-service bank, it can play with the big kids, having added more than one million new clients to end up just 100,000 customers shy of Nedbank’s base.
For the full year ended 29 February 2016, Capitec reported a 26% jump in headline earnings, to R3.2 billion.
Net income increased 19% to R9.06 billion, while operating expenses climbed by 14% to R4.6 billion, led primarily by staff costs and branch expansion.
The highlight of Capitec’s results, however, is the significant boost in clients. The bank added 1.025 million new clients to a total active base of 7.3 million.
Capitec CEO Gerrie Fourie believes that rapid growth is due to their pricing transparency and easier-to-use technology, singling out their cellphone banking offer as the standout performer.
Here’s how the other banks stack up over the past financial year:
South Africa’s biggest bank by clients its Standard Bank – a position it has held for a number of years, having usurped Absa. The bank does not release a specific breakdown of its clients, however the number stood at 11.1 million South African customers at December 2014.
Absa, trading as Barclays Africa, has seen only a small increase of around 200,000 South African customers in the past financial year, with 9.4 million clients at December 2015.
However, Absa remains the second biggest bank, as a ‘write down’ of banking customers in 2015 ( in which accounts were reclassified as dormant) saw FNB drop from 7.3 million customers to 7.1 million.
According to Ryan Prozesky, CEO of Value Banking Solutions at FNB, as at December 2015 (FNB’s interim period), the bank had 7.2 million customers.
The bank said that it only includes accounts that are recently active (customer initiated transactions), excluding automated transactions such as interest payments.
A little bit of competition is always healthy so keep ’em coming…
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