New bank launching in South Africa in 2027 – and it already has 2,500 branches
Pepkor Holdings Ltd. hired Merwe Scholtz to lead a new banking push as Africa’s largest clothing and mobile phone retailer prepares to launch an independent lender as early as next year.
The Cape Town-based company already sells smartphones and extends credit to customers.
It said in an investor presentation Tuesday that adding deposits would complete a full-service banking offering — confirming earlier Bloomberg reporting that it was weighing such a move.
With about a sixth of South Africans unbanked or underserved, Pepkor is following retailers, including Shoprite Holdings Ltd., in using customer data to expand into financial services.
It would be targeting shoppers already transacting in-store but not fully captured by traditional banks.
Pepkor plans to use its more than 6,500 stores to support the digital bank, with build costs of less than R1 billion and a return-on-equity target exceeding 30% by the fifth year.
The group operates over 2,500 stores in South Africa alone. It said its model combines retail footfall, device distribution and financial services on a single platform.
This is a mix it sees as unique in a market where banks dominate income and risk segmentation, retailers drive traffic and telecommunications firms control the device layer.
The strategy builds on significant existing activity across its business, including more than 2 million money transfers, over 22 million cash withdrawals, and about 65,000 loans already processed.
It is also aimed at lower-income consumers, Pepkor’s core customer base, who typically earn less than R15,000 a month.
Among those earning below R8,000, 57% prefer paying bills through retailers compared with 36% via banks, the company said, underscoring scope to shift more transactions onto its platform.
Pepkor received regulatory approval last year to establish a banking unit and has since acquired a financial technology platform to support its expansion.
An independent advisory board, already largely in place, will oversee the lender.
In December, the retailer appointed former Investec Bank Chief Executive Officer Richard Wainwright as an independent non-executive director.
Pepkor’s fintech revenue rose 31% to R16.6 billion in the year through September, accounting for 17% of total sales.
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