{"id":791546,"date":"2024-09-18T17:00:00","date_gmt":"2024-09-18T15:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=791546"},"modified":"2024-09-18T16:00:10","modified_gmt":"2024-09-18T14:00:10","slug":"new-south-african-bank-ready-to-take-on-capitec","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/banking\/791546\/new-south-african-bank-ready-to-take-on-capitec\/","title":{"rendered":"New South African bank ready to take on Capitec"},"content":{"rendered":"\n

Old Mutual Bank, backed by the powerful Old Mutual investment, savings, and insurance group, is getting ready to fight Capitec.<\/p>\n\n\n\n

Old Mutual recently announced that it has appointed Clarence Nethengwe as the bank\u2019s new chief executive.<\/p>\n\n\n\n

Nethengwe is an Old Mutual stalwart who has previously overseen the insurer\u2019s unsecured lending business and finance division.<\/p>\n\n\n\n

The company said Old Mutual Bank had completed its R1.75 billion bank-build process and received section 17 approval from the Prudential Authority earlier this year.<\/p>\n\n\n\n

Armed with a new CEO and all the necessary systems and approvals, it is set to launch before the end of the year.<\/p>\n\n\n\n

What sets Old Mutual Bank apart from new market entrants is that it is starting with 1 million customers.<\/p>\n\n\n\n

Despite not having a formal bank, Old Mutual has played in the space for some time with its transaction Money Account.<\/p>\n\n\n\n

Bidvest Bank currently administers this transactional banking account. However, this will change before Old Mutual\u2019s new bank launches.<\/p>\n\n\n\n

Old Mutual CEO Iain Williamson said this offering already significantly contributes to the insurer\u2019s profitability.<\/p>\n\n\n\n

The insurer has over one million clients using its Money Account, and its unsecured lending business has a book worth R16 billion.<\/p>\n\n\n\n

Old Mutual\u2019s home loan book totals over R5 billion and is currently housed in a separate subsidiary.<\/p>\n\n\n\n

Although Old Mutual would not say it is directly competing with Capitec, it is going after the same market segment.<\/p>\n\n\n\n

Old Mutual Bank will target South Africans earning between R5,000 and R80,000 monthly. This is Capitec\u2019s stomping ground.<\/p>\n\n\n\n

Old Mutual will offer banking services to the 3.1 million low-income South Africans its Mass and Foundation insurance cluster serves.<\/p>\n\n\n\n

This cluster serves low-income and lower-middle-income individuals, who typically earn between R1,000 and R30,000 per month.<\/p>\n\n\n\n

Capitec not too concerned about Old Mutual Bank<\/strong><\/h2>\n\n\n\n
\"\"<\/a>
Capitec CEO Gerrie Fourie<\/figcaption><\/figure>\n\n\n\n

Capitec CEO Gerrie Fourie said he is more concerned about the competition that international brands like Apple and Facebook could bring than local market players.<\/p>\n\n\n\n

In April 2024, Fourie told Daily Investor he is not concerned about Old Mutual entering the market.<\/p>\n\n\n\n

\u201cOld Mutual has been a bank for quite a while. They rented a bank license. So, the offer has been exactly the same \u2013 they\u2019ve been offering banking services,\u201d he said.<\/p>\n\n\n\n

\u201cThey are now just getting their own banking license and their own banking system.\u201d<\/p>\n\n\n\n

\u201cWhat that offer looks like we haven\u2019t seen, but I don\u2019t expect that it will materially change from what they\u2019ve done in the past. So, let\u2019s wait and see what comes out of the banking system.\u201d<\/p>\n\n\n\n

Fourie said Capitec has built quite a compelling offer over the past couple of years, which created great client loyalty.<\/p>\n\n\n\n

He said other companies concern him more than Old Mutual. \u201cI\u2019m much more worried about your international players with strong brands than the South African players,\u201d Fourie said.<\/p>\n\n\n\n

\u201cWe always watch them, and we\u2019re always careful, but the brand positioning of international players \u2013 I am watching that space more.<\/p>\n\n\n\n

\u201cBut we are working the whole time to make sure our client needs are satisfied. And we\u2019re delivering what the client wants.\u201d<\/p>\n\n\n\n

Fourie said many international players could disrupt South Africa\u2019s banking space, and he identified Apple and Facebook as two potential competitors.<\/p>\n\n\n\n

\u201cApple is an unbelievable, strong trade name. And if they come into South Africa with full banking, that\u2019s a strong proposition,\u201d he said.<\/p>\n\n\n\n

However, he said that, ultimately, the player who understands the client\u2019s needs the best and delivers on them will be the one who wins.<\/p>\n\n\n\n

\n\n\n\n

Read: Battle of the banks 2024: Capitec vs Standard Bank vs FNB vs Absa vs Nedbank<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Old Mutual Bank, backed by the powerful Old Mutual investment, savings, and insurance group, is getting ready to fight Capitec.<\/p>\n","protected":false},"author":10,"featured_media":769180,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[961],"tags":[1798,20538,20195,20539,1110,20537],"class_list":["post-791546","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-banking","tag-capitec","tag-clarence-nethengwe","tag-gerrie-fourie","tag-iain-williamson","tag-old-mutual","tag-old-mutual-bank"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/791546","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=791546"}],"version-history":[{"count":2,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/791546\/revisions"}],"predecessor-version":[{"id":791553,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/791546\/revisions\/791553"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/769180"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=791546"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=791546"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=791546"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}