Capitec launches new ‘flexible’ credit option – here’s how it works

Capitec has launched a new access facility aimed at providing affordable revolving credit to customers.

The bank said that the facility can be fully managed from the group’s app allowing clients to decide how much of the facility they want to use at any given point in time, as well as select a monthly repayment amount or period they are comfortable with.

“The Capitec Access Facility allows South Africans to get funding for specific long-term purposes or projects,” said Francois Viviers, executive of Marketing and Communications at Capitec.

“It gives you instant access to money, which can be used as it is required to renovate your home, purchase equipment needed to start a side business or pay for education.”

“In just over a month we’ve seen over 17,000 Access Facilities sold, with the majority of clients being middle to higher-income earners.

“A significant number of clients are using the facility for home improvement, which, given the current lockdown, has become a priority for people.”

How it works

After a once-off in-branch credit assessment clients get access to the revolving credit, over a period of up to 60 months and once an amount is repaid it can be accessed again should the need arise.

Capitec said it will give competitive interest rates, based on a client’s credit profile, are linked to prime and range from 12.4% to 17.25%.

Initiation fees are charged once off, and the monthly fee of R69 is only payable when the client has an outstanding balance, the bank said.

“If a client doesn’t use the facility, no fees are charged, which means no interest or monthly admin fees are payable. This flexibility makes the Capitec Access Facility great for unplanned life events.” said Viviers.

He added that unlike traditional revolving loan facilities, which usually have a fixed monthly instalment, the Capitec Access Facility offers increased flexibility.

It allows clients to make additional repayments that can be used to lower monthly instalments or reduce repayment periods, which leads to a saving in interest.

Should a client face unplanned life events and need additional disposable income, the repayment period can be extended (up to a maximum of 60 months) to reduce the amount paid back each month, he said.

“When designing the Capitec Access Facility we wanted to offer our clients a credit solution that was affordable and flexible enough to cater to each person’s needs.

“We believe we’ve created a product that will enable our clients to realise their goals and ultimately live better.” said Viviers.

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Capitec launches new ‘flexible’ credit option – here’s how it works