CAPITEC EYES THE MID­DLE CLASS

CityPress - - Business - JUSTIN BROWN justin.brown@city­press.co.za

Capitec is look­ing to grow its mar­ket share in the lo­cal mid­dle-in­come mar­ket af­ter es­tab­lish­ing a strong po­si­tion among low-in­come earn­ers, CEO Ger­rie Fourie said dur­ing an in­ter­view.

Fourie es­ti­mated that low-in­come earn­ers made up 14 mil­lion peo­ple, mid­dle-in­come earn­ers 4 mil­lion peo­ple and high-in­come earn­ers 700 000 peo­ple.

Capitec de­fines a low-in­come earner as a per­son earn­ing less than R10 000 per month, a mid­dlein­come earner gen­er­ates be­tween R10 000 and R30 000 per month and a high-in­come earner gen­er­ates more than R30 000 per month.

Fourie said that Capitec es­ti­mated that the bank had a 27% share of low-in­come earn­ers, an 11% share of mid­dle-in­come earn­ers and a 2% share of high­in­come earn­ers.

Capitec would be tar­get­ing mid­dle- and high­in­come earn­ers by hav­ing branches in top-end malls, through the launch of its credit card and the bank’s low-cost fee struc­tures.

Higher-end earn­ers would re­main out of Capitec’s reach as they pre­ferred pri­vate bank­ing ser­vices, Fourie said.

In Septem­ber last year, Capitec launched its credit card.

Fourie said that, at the end of Fe­bru­ary, there were 100 000 Capitec credit cards in is­sue out of 8.3 mil­lion credit cards in is­sue in South Africa.

The num­ber of its credit cards be­ing is­sued ev­ery month was about 20 000.

The credit card loan book now stood at R560 mil­lion out of a to­tal lo­cal credit card loan book of R100 bil­lion.

Fourie said that 80% of the Capitec credit cards were is­sued to ex­ist­ing Capitec clients. Capitec would only start ad­ver­tis­ing its credit card from the third quar­ter of 2018.

Dur­ing the year to Fe­bru­ary, Capitec gained 1.3 mil­lion clients to take its to­tal clients to 8.6 mil­lion, in­clud­ing 3.9 mil­lion bank­ing clients.

In the same year, Capitec added 76 new branches and 400 new ATMs. In the year to Fe­bru­ary 2018, Capitec was look­ing to add 40 to 50 new branches and 400 new ATMs.

Dur­ing the year to Fe­bru­ary 2017, Capitec added 1 629 ex­tra jobs to take its staff count to 13 069 peo­ple.

Four-hun­dred to 450 peo­ple were join­ing the com­pany each month, Fourie said.

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