SA’s fastest-growing bank

Capitec Bank’s low-cost, highly disruptive model and unique offerings continue to build momentum

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Capitec Bank’s low-cost, highly disruptive model and unique offerings continue to build momentum and, today, the bank has over 10 million clients, an amazing milestone to achieve in a relatively short period of time

Gerrie Fourie, the CEO, discusses their innovative offerings, the role of simplicity and transparency in terms of their winning business philosophy and positioning, and the importance of offering a personalised service experience.

According to Fourie, their growth can be attributed to several things the bank has done differently by focusing on the needs of their clients instead of offering traditional banking solutions.

“Firstly, we don’t differentiate according to age or income. Every Capitec client receives the same quality product and consistent service experience, making our clients feel valued.

“Secondly, we designed our banking solutions to be simple and transparent, as this makes what we offer more accessible—and appealing—to most South Africans. Lastly, we made banking more affordable through our use of technology and innovative processes, so that our clients always get a sense of value for money,” he explains.

As life gets busier and more complex, clients are demanding simplicity and immediate service from their bank.

“It’s something we recognised when we started Capitec and something on which we continue to focus. Given the economic climate, consumers are even more cost-conscious and, therefore, our low-fees remain appealing.

Transparency and simplicity

These are two aspects, which have always been core to Capitec’s brand.

“Simplicity and transparency are fundamental to our business philosophy and positioning, and the core of our vision is quite simply to make financial services more understandable for the client.

“For example, we use sophisticated technology and processes at the backend to make the experience for a client as simple and seamless as possible when opening an account or applying for credit. Everything is fulfilled in real-time with no paperwork. This simple process creates more time for our consultant to inform the client about our products, and helps the client to feel in control,” he says, adding that the simplicity of the design of their banking app has also been the main reason for the phenomenal rate at which people have adopted it as their primary way to bank.

Mobile-centricity

Capitec believes their clients should be able to do anything with their money, at any time, on any device from anywhere in the world. Their app is the first step in this vision and is extremely important for clients, as their devices become central to managing their lives.

“For example, through the Capitec app, clients can create a budget, make payments and transfers, create personalised savings plans and apply for credit.

“Our banking app now has over three million activated clients and we are seeing more activity each quarter. Last month, for example, there were 22 million transactions on the app, and because it offers zero-rated data and transaction fees at a third of the branch fees, our clients saved millions in bank fees,” Fourie enthuses.

As greater numbers of people are able to access connectivity, Fourie believes the key growth area in the banking sector will come from giving more people access to simple digital payments, savings and credit solutions, combined with relevant insights on how to bank better and manage their financial lives better.

“There is still a lot of potential for growth in the informal market where cash is still king, and a lot of potential for efficiency in the traditional banking market where people still make use of branches and ATMs,” he explains.

Personalised, quality service

In terms of more services being added to the app, thus removing the need to visit a branch, Fourie believes this goes back to the question, ‘Is digital going to kill a branch?’.

“My answer there is no. Digital enables you to transact conveniently and easily, but when you want to understand a product, there is nothing that beats face-to-face human interaction. Our consultants are trained to convey information in a way that helps our clients understand what we offer, but it begins with us listening to first understand their needs.

“The strongest form of marketing is word of mouth and this is achieved mainly through a great and personalised service experience,” he explains

As much as the world has gone digital, Capitec has evolved its retail environment for face-to-face interaction.

Fourie explains that,from their early days, they have made their branch environment as welcoming and convenient as possible.

“It starts with convenient hours, like being open until 6pm, as well as on weekends; times when clients do not have to be at work. More than 300 of our branches, mainly in shopping malls, also trade on Sundays, making it easy for our clients to do their banking while they shop.

“For cash transactions, we have also evolved our offering. For example, we are in the process of rolling out branches without cashiers. These branches make use of dual note recycler technology that allows cash deposits, payments and transfers and withdrawals.

“Deposits are used to fund withdrawals, effectively recycling cash and reducing the need, cost and risk of transporting it. This also makes the transaction much cheaper to the client versus doing so with a cashier. With this innovation, we are maximising consultants’ time to assist clients with more complex transactions like opening accounts, fixed-term savings, applying for credit or taking up funeral plans,” he explains.

The launch of Capitec Insure

Capitec Insure adds another component to meet their clients’ financial needs. Fourie explains that, together with Centriq, they’ve built a platform that will enable them to offer all types of insurance products.

“We’ve started with funeral insurance because we believe there’s a big market out there. Taking what we’ve done on the banking side to make it simple and transparent, we have created what we believe is a disruptive product in the insurance space,” he explains.

And, indeed, they have, as they’re averaging about 2 000 policies per day, which Fourie believes is a very strong number.

The future of Capitec

The bank is continuously evolving their products and processes to serve their clients’ needs better. On the credit side, they are developing the processes to make it simpler and faster to understand your credit profile and to get credit when you need it.

“We are also developing the product to give clients a more personalised offer with much more competitive interest rates,” Fourie says.

On the banking side, they are improving their self-service and remote banking functionality, and are building the capability to give their clients real-time and relevant insights on how to manage their money better.

The leader at the helm

Gerrie Fourie joined Capitec to be an entrepreneur. He says it was an opportunity to start something from scratch. And that’s what they’ve done.

“We’ve built the bank from nothing, to where it is today. So, it’s really understanding the whole business acumen side of it. Applying our philosophy of simplicity and transparency throughout the organization.

“Capitec, today, still remains an entrepreneurial company. We make decisions quickly and allow our people to innovate and grow the organisation with us. This gives me the opportunity to focus on the future vision, to communicate it clearly and ensure that we deliver on it,” he says.

In terms of what he enjoys most about his role, Fourie says working with people, learning from them and motivating them is paramount.

“I also enjoy sharing ideas and motivating people. My role is very much to inspire people to fulfil their full potential. We’ve got 14 000 people working for the bank and I try to ensure that every one of them is fulfilling their potential.

“I keep leadership very simple and, for me, it’s all about the “why”. And in asking “why?”, being able to explain very complex things very simply so that a person can understand them is crucial.

“If you understand the “why”, you will know why you’re doing certain things and you will deliver on them more effectively. If you don’t understand the “why”, you won’t do it, or you won’t do it with your full heart,” he says.

The CEO philosophy

Fourie explains that the entire philosophy behind the CEO programme, which stands for Client first, Energy and Ownership, is the ideal that every single person in the bank should think and act as though they are the CEO.

“I want each person to consider the clients’ needs first and to act in the best interest of our clients. They should fulfil their role with energy and enthusiasm, to contribute to a positive and inspiring culture. And we want every person to take ownership of what they’re doing. I want each person to act as if it’s their own company whenever they perform a function,” he concludes.

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