Banking

Capitec shooting the lights out

Luke Fraser

 ·1 Oct 2025

Capitec has seen yet another significant rise in headline earnings, with the bank’s total client base also breaking the 25 million mark. 

In its interim results for the six months ended 31 August 2025, headline earnings grew by 26% to R8 billion. 

The group generated an ROE of 31% (2024:29%), with the group’s interim dividend also increased by 26% to 2,620 cents (August 2024: 2,085 cents). 

The group’s net interest income grew by 23%, driven by a 40% growth in loan disbursements and a 16% increase in interest income on lending. 

Business banking loan disbursements jumped by 42%, continuing the trend from the prior financial year. 

“Leveraging the data available to us to score clients more accurately allowed us to make more targeted offers to lower-risk clients. This led to a growth of 32% in Personal banking loan disbursements,” it said. 

Its international lending business, AvaFin—which was only included for four months in 2024—generated interest income on lending of R1.7 billion (2024: R854 million). 

A restructuring of the group’s savings account products and reductions in the repo rate led to a decline in interest expenses to R4.7 billion (2024: R5.1 billion) despite an 11% increase in deposits and wholesale funding. 

The group noted that the migration to the higher interest rate accounts has been slower than expected, adding to a decrease in interest expense. 

With the group’s gross loan book growing by 12%, the gross credit impairment charge on loans and advances increased by 18%. 

Another negative sign was the group’s credit loss ratio, including AvaFin, increasing to 7.9% (2024: 7.6%). 

AvaFin contributed R761 million to the charge compared to R305 million for the 4 months ended August 2024, as their loan books grew by 48%. 

Regarding customer numbers, Capitec’s Personal banking clients grew to 24.4 million from 22.8 million in 2024 (February 2025: 23.6 million). 

Fully banked clients increased by 11% to 9.4 million and comprised 38% of its active clients, up slightly from 37% in 2024. 

Other businesses shine

The group’s net non-interest income was 65% of the income from operations after credit impairments (2024:67%). 

Total net transaction fee and commission income, excluding VAS and income from Capitec Connect, increased by 7%, with growth impacted by a reduction in transaction fees. 

Capitec noted that the move away from cash transacting continued, with digital and card payments comprising 91% of transaction volumes, excluding system-generated transactions (2024:89%). 

Value-added-service income continued to grow rapidly and totalled R2.7 billion, an increase of 36%. 

The net insurance result jumped by 45% to R2.4 billion, while the increase in personal banking loan disbursements contributed to a 12% increase in credit life insurance income.

Funeral and life cover income saw double-digit growth and increased to R1.4 billion (2024: R735 million). 

Growth in funeral income was partly driven by the inclusion of 100% of profits on funeral policies issued from 1 November 2024. A prior profit-sharing arrangement, where it paid 30% of profits to a partner, ended. 

Net income from Capitec Connect more than doubled to R165 million (2024: R69 million), while the number of active clients in the last 3 months reached 1.1 million (2024: 0.6 million). 

Data usage increased by over 100% to 14.9 petabytes (2024: 5.1 petabytes) while voice usage grew from 95 million minutes to 311 million minutes.