Capitec has 26.6 million active clients. Getting more of them to buy their electricity, mobile data and insurance through the same company is proving to be a lucrative expansion strategy. Its latest results show how far the Stellenbosch group has travelled from the low-cost banking proposition that brought those customers through the door.
Headline earnings increased 19% to R9.5 billion for the six months ended 31 August 2026. Personal banking contributed 37% of group earnings, while fintech accounted for 29% and insurance another 27%, according to Capitec’s announcement.
The group recently dropped “Bank Holdings” from its name to become Capitec Limited. With that earnings mix, the shorter name makes sense. Banking provides the customer relationship; an increasing share of the profit comes from what Capitec can sell through it.
A customer base most businesses can only envy
Capitec’s fintech businesses contributed R2.7 billion to headline earnings, up 30%. The division includes value-added services such as prepaid airtime and electricity, alongside the Capitec Connect mobile business.
A company trying to sell those services independently has to persuade people to find it, trust it and pay it. Capitec already has an app that 16.5 million clients used in the final month of the reporting period. Adding another purchase to that app gives it a distribution advantage before a competing service has even made its pitch.
Connect’s active client base reached 1.8 million, measured over the preceding three months, compared with 1.1 million a year earlier. Data usage more than doubled to 34.3 million gigabytes. Customers also used 70 million free Connect-to-Connect call minutes, and bought 27,000 phones through the app during the six months.
Those phone sales extend the relationship further. Capitec can now sell the device on which a customer uses its banking app, alongside the connectivity that keeps it online.
The Connect benefits encourage customers to bring their banking and mobile habits closer together, with extra data for linking a Connect number to a main account. Customers may get useful savings. Capitec gets more opportunities to earn from an existing relationship.
Payments connect both sides of the counter
Capitec wants to become the leading payments provider, and its merchant business is growing quickly. Merchant accounts increased 66% to 141,000, while business banking headline earnings rose 52% to R609 million.
Serving merchants puts Capitec on the receiving side of the spending it already helps personal banking customers make. It also creates opportunities to provide those businesses with credit: the business loan book grew 37% to R35.5 billion.
Digital transaction volumes, excluding value-added services, increased 26% to 662 million. Meanwhile, spending through Apple Pay, Garmin Pay, Google Pay and Samsung Pay rose 87% to R52.1 billion.
Capitec doesn’t need to persuade everyone to abandon their preferred phone wallet. It can retain the banking relationship beneath those payments while expanding its services to the businesses accepting them.
Scale has to work for the customer
The cost-to-income ratio improved from 40% to 36%, which Capitec attributes to earlier investments supporting growth. The group also says it kept fees unchanged for a second year. Growing profit alongside unchanged fees gives management some evidence for its argument that scale can benefit customers and shareholders.
But a growing customer base also places greater demands on the systems serving it. Business customers accepting payments need dependable access to their money. Selling them additional financial services raises the cost of getting that basic requirement wrong.
The physical network is taking on more work too. Following the Smart ID service rollout, Capitec says it has processed more than 594,000 applications since March, with the service available at 248 branches.
For customers, the appeal is understandable: fewer places to visit and more purchases handled through something familiar. Competitors have to contend with that convenience as well as Capitec’s pricing. Once the bank is already on the customer’s phone, another business needs to offer a compelling reason to open a different app.