SA’s banks are rolling out innovative value-added services (VAS) as a potent means to retain active clients and woo new ones to their fold, with clear winners and losers in this regard.
The results of SA’s banking majors also show a strong correlation between the number of digitally active clients in relation to the performance of VAS services, which have become central in giving consumers optionality and convenience.
Capitec has mined its more than 2-trillion data points to roll out VAS services, which have helped it amass nearly 13-million clients, making the Stellenbosch outfit the biggest digital lender in the country.
In the year ended February 2025, Capitec reported 15% growth in the number of active app clients to 12.9-million. To put this in context, this amounts to 20% of the population.
Capitec in the year under review reported a 56% surge in net income from VAS to R4.2bn due to higher client adoption as the VAS products mature, as well as an increase in the number of clients using VAS to 10.9-million.
With its nearly 25 million clients, Capitec still has room to get more of these clients to adopt its VAS offering.
Investment in technology and data
“Our continued focus on and investment in technology and data has been pivotal in the creation of a business that can scale to the benefit of our clients. We have invested in best-in-class platforms and technology which have given management the ability to be agile and have enabled the business to scale,” the bank said in its annual report.
“We replatformed our banking app and focused on moving all our data to the cloud and unlocking efficiencies in systems. This has allowed us to accelerate the time to market of new offerings and unlock value for clients by being able to rapidly analyse data and refine our offerings to meet client needs.”
The volumes of prepaid data, airtime and electricity sold by Capitec increased 14% and income on these transactions grew 15% to R1.4bn in the year to end-February — commanding a large market share in the segment.
One of the popular VAS products taken by Capitec to market in recent times is the vehicle licence renewal facility that went to market in February 2024 and had already reported 319,707 renewals done on the bank’s app at end-February with a 20% market share.
FNB, which has just breached 10-million active clients mark [excluding e-wallets] for the first time, reported 15% growth in total revenue from VAS, with these services raking in about R2.9bn in revenue.
The lender said 3-million of its customers use these services, which include: FNB Connect, Send Money, eBucks and nav [pronounced Nav-igate].
The bank’s digitally active client base grew to just under 8-million in the year ended June. The lender’s send money proposition, e-wallet, which was the first to market had another stellar year, recording 69-million transactions in the year under review.
“FNB’s focus is to build out broader functionality beyond traditional Send Money activities as part of its payment modernisation initiatives,” the bank said.
FNB’s nav products have also taken off, with nav»Home having placed about 58,000 families in homes and paid out R71bn in loans since inception. The lender now originates 12% of home loans through this channel.
On the other hand, WesBank has financed R1.5bn worth of vehicles via nav»Car.
FNB CEO Harry Kellan told Business Day that the bank took its VAS offering seriously. “The VAS strategy has been around for a while. And we expected to see more activity as we get more connectivity with Payshap and more digital payments processes. We know that as soon as customers migrate from cash to digital payments, we see activity growing,” he said.
Nedbank in the year ended December 2024 reported a 17% increase in VAS volumes across all products, including bill payments and digital vouchers, with more than 1.6-million clients buying products via the platform.
The group’s money transfer product, which enables clients to send money to any South African cellphone number, showed notable growth in 2024, increasing revenue by 54%.
Nedbank’s VAS offerings were enhanced to include vehicle quick-quote insurance, licence renewals, traffic fine payments as well as expanded assurance and funeral product functionality.
The lender’s digitally active clients increased by 7% to 3.1-million, of which 2.7-million clients are using the Money app.
Nedbank’s focus is on expanding the Avo SuperShop app, implementing new commercial models and channels for VAS and growing our insurance offerings.
Absa’s value-added initiatives include enhanced customer rewards programmes such as free Absa rewards and cumulative pricing relief for everyday banking customers.
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