CAPE TOWN - At least three big new banking options will be entering a highly competitive market next year, giving South Africa more options, BusinessTech reported.
According to a poll conducted by BusinessTech, Capitec would not be a bank South Africans would switch to.
Capitec said that it added 400,000 customers since February to June 2017, becoming the second biggest bank in the country.
Its success has forced South Africa’s other banks to compete more effectively and has led to Absa and FNB in particular to launch entry-level accounts that target Capitec’s market approach.
However, it is said that Patrice Motsepe’s Tyme, which promises to cause disturbance of its own through a digital play might leave Capitec facing stiff new competition of its own
Bloomberg has reported that African Rainbow Capital (ARC), the financial-services firm started by Motsepe, was close to getting the banking licence it needs to challenge the dominance of South Africa’s biggest lenders.
Bloomberg also reported that South African Reserve Bank had last year granted Tyme a provisional licence with Johan van der Merwe, co- CEO of African Rainbow Capital stating that the company expected a full licence before the end of September.
“The South African banking environment is due for a bit of disruption,” said van der Merwe. “While Capitec has been able to play that role, the soon-to-be-licensed lender will be a disruption over and above that. This will be a complete game changer.” “The regulator is looking at the cloud-based system that ARC’s fintech partner is using to make sure it works before granting a full licence,” he said.
Insurance giant Discovery, had also announced that it had received authorisation from the Registrar of Banks to establish banking operations in South Africa, and is on track to launch it's banking products next year.
Adrian Gore, Discovery CEO, first announced plans for a retail bank in 2015, and stated that it would be a direct competitor to the current “big five”.
The South African Post Office (SAPO) could also prove to be a large disturber in the financial sector because of its ease and accessibility.
Telecommunications minister Siyabonga Cwele, speaking at the World Economic Forum in May said that the Post Office’s transition into a development bank will be government’s first big step in “radically transforming the financial sector and challenging the current banking institutions”.
Plans are underway to remodel the South African Post Office (SAPO) into a fully-fledged bank in 2018, current Chief executive Mark Barnes said. He was addressing the National Press Club in Pretoria in April
"Let me tell you about where you are and what the future is. We believe that the Post Office will prove to be a critical element in financial inclusion, for a number of reasons. You would be well aware that we are well advanced towards getting a fully-fledged banking licence," said Barnes.