Capitec Bank Reports Strong Financial Year with Focus on Technology Investment

South African financial institution Capitec Bank has concluded its fiscal year with robust financial performance, highlighting a strategic emphasis on technology investments. The bank’s CEO, Gerrie Fourie, announced a 16% increase in full-year profit, indicating a positive trajectory for the institution. Capitec Bank, a significant player in the South African banking sector, has been making strategic moves to cater to low-income earners often overlooked by larger banks.

Despite facing challenges such as higher impairments due to customer financial constraints caused by interest rate hikes and food inflation, Capitec Bank remains optimistic about its future prospects. The bank, which boasts 22 million retail clients, has seen improvements in client cash flow, with a decline in insufficient fund transactions over the past six months.

One of the key focus areas for Capitec Bank moving forward is to bring its life cover offerings in-house, following the termination of its partnership with insurer Sanlam. This strategic shift aligns with the bank’s overarching goal of building a robust insurance business alongside its core banking services.

Capitec Bank’s commitment to technology advancement is evident in its significant increase in IT spending, rising by 27% in the 2024 financial year. This investment in technology infrastructure is viewed as critical to the bank’s long-term strategic objectives, particularly in enhancing customer service and operational efficiency.

As Capitec expands its technology capabilities, the bank faces stiff competition in attracting top IT talent, prompting aggressive recruitment efforts. The institution saw a notable increase in external applications for specialized skill sets in the past year, demonstrating its appeal to top technical professionals in South Africa.

In a bid to further bolster its technology workforce, Capitec Bank is also focusing on upskilling non-technical employees through a targeted learnership program. This initiative aims to equip existing staff with the necessary skills to transition into technology roles within the organization.