Capitec continues to attract and retain customers but it remains to be seen how much longer they are prepared to put up with the interminable queues at its ATMs.
With more neobanks entering the SA market, more options are becoming available and frustrated Capitec account holders might be tempted to fly the coop.
This week Canadian-based Be Mobile announced its local entry. It is targeting the unbanked and underbanked, offering low to no-fee banking products through its app.
Bettr has yet to launch in SA, but it is already in beta stage and built around Generation Z, the demographic that is fuelling the so-called creator economy boom of gamers, influencers, Instagram, TikTok, and YouTube. Bettr has partnered with Nigeria-based Access Bank, the continent’s fastest-growing lender in preparation for expansion.
“Our aim is to power this growing economy of young creators with the platform, tools, and resources they need to thrive,” Bettr CEO Tobie van Zyl said recently.
Capitec’s loyal customers, meanwhile, are the butt of jokes on social media for enduring long queues at its ATMs — often ignoring other banks’ ATMs even if it means a longer wait. And with more people opting to bank at Capitec, there can be no doubt that the queues at its ATMs will only lengthen.
Admittedly, the lender continues to encourage account holders to use its Pay Me function on its banking app, which enables clients to generate a personalised QR code to receive payments immediately and securely from other Capitec clients.
Still, its clients prefer paper money even where options are available to transact electronically. Cash might be king for now, but it is an irritation a competitor can easily exploit.
Capitec needs to act soon or risk losing its clients. It could become more innovative simply by partnering with pioneering African tech start-ups. It could take a leaf from Ivory Coast-based Cerco, which has developed Superphone, a voice-operated and keyboard-less smartphone targeting 40% of Africa’s illiterate people.
The Superphone — assembled in Ivory Coast — makes everyday tasks more accessible such as making sense of documents and checking bank balances. The smartphone covers 17 languages in Ivory Coast and 50 other African dialects.
“The goal is to address the ‘frustration’ illiterate people feel with technology that requires them to be able to read, write, or spell effectively,” Cerco president Alain Capo-Chichi, a Benin national, recently told an Ivorian publication.
Imagine Capitec partnering with Cerco to create voice-enabled ATMs and apps that communicate in all 11 SA’s official languages. Such a move could be a significant differentiator that meets customers’ digital needs.
Similarly, tech-savvy account holders should be empowered to access ATMs using a smartphone. Even Gen Zers or Millennials still need cash, but they are interested in innovative ways of accessing it.
However, the stance of Capitec bosses is that they do not believe in innovation for its own sake. “Each new feature must put clients in better control of their financial needs,” says executive of marketing Francois Viviers.
On Tuesday, billionaire Patrice Motsepe’s digital TymeBank announced it had reached 5-million users on June 30, proving that competition for local clients through innovation is hotting up.
If Capitec does not find creative ways to remain relevant, it risks being surpassed by TymeBank and even Shoprite.
The supermarket retailer now also has a transactional bank account, with services linked to its stores’ business hours. Account holders can deposit and withdraw cash at any Checkers, Shoprite or USave outlet. They can also send money, buy airtime, data, electricity, send grocery vouchers, pay bills, and pay for groceries using their smartphones.
Big tech companies such as Google, Facebook, MTN, and Vodacom are also coming for the same Capitec clients through their disruptive products.
The likes of Capitec do well to take careful note and respond accordingly — and quickly.
• Lourie is the founder and editor of TechFinancials.
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