CAPITEC bank is branching out into home loans after it reportedly successfully weathered a storm in the unsecured loan market.
The 15-year-old bank, one of South Africa’s biggest unsecured lenders, announced at its annual general meeting on Friday it had concluded a co-operation agreement with SA Home Loans.
The deal is to pilot the introduction of home loans throughout branches in Gauteng initially and then in the rest of the country where SA Home Loans has support infrastructure.
Capitec’s chief executive Gerrie Fourie announced: “We recently embarked on the #AskWhy Campaign and the feedback from our customers was that they wanted the ‘Capitec simplicity approach’ to home loans.
“In response to this, we entered into an agreement with SA Home Loans to deliver home loans to the market in the simple, efficient way that both our client service models are well-known for.
“The offer will be piloted in 160 Capitec branches in Gauteng from the 7th of July and will be rolled out to the rest of the country in due course,” Fourie said.
Fourie added that Capitec Bank signed the cooperation agreement with SA Home Loans because the company had a good “cultural fit” with Capitec.
Founded in 1999, SA Home Loans is a fairly young company that takes a fresh approach in the marketplace by offering a non-traditional, quick, easy, transparent and personalised service.
“The core company values and customer focus of SA Home Loans aligns with that of Capitec Bank,” said Fourie.
The product will be the same as that which is offered by SA Home Loans, and will be available to new bond applicants as well as Capitec clients with existing home loans who would like to benefit from switching their bonds to SA Home Loans.
“Whilst this boosts our product offering and brings us closer to becoming a one-stop solution for clients, the agreement expands distribution for SA Home Loans through most of our over 630 branches,” Fourie said.
In a Sunday Times interview at the weekend, Fourie said Capitec had weathered the unsecured lending storm through responsible lending.
“We don’t lend to social grant recipients. We have a large chunk of retail funding, and our provisioning is far more conservative.”
This has ensured resilience and ability to continue growing profit in an industry dogged by massive debt write-offs.
Although Capitec’s board presented a strong story, some analysts at Friday’s annual general meeting remained concerned about the outlook for a major player in an industry that is overshadowed by extensive write-offs at African Bank, which dominates the market with a 35% share.
Capitec to offer home loans
The 15-year-old bank, one of South Africa’s biggest unsecured lenders, announced at its annual general meeting on Friday it had concluded a co-operation agreement with SA Home Loans.
The deal is to pilot the introduction of home loans throughout branches in Gauteng initially and then in the rest of the country where SA Home Loans has support infrastructure.
Capitec’s chief executive Gerrie Fourie announced: “We recently embarked on the #AskWhy Campaign and the feedback from our customers was that they wanted the ‘Capitec simplicity approach’ to home loans.
“In response to this, we entered into an agreement with SA Home Loans to deliver home loans to the market in the simple, efficient way that both our client service models are well-known for.
“The offer will be piloted in 160 Capitec branches in Gauteng from the 7th of July and will be rolled out to the rest of the country in due course,” Fourie said.
Fourie added that Capitec Bank signed the cooperation agreement with SA Home Loans because the company had a good “cultural fit” with Capitec.
Founded in 1999, SA Home Loans is a fairly young company that takes a fresh approach in the marketplace by offering a non-traditional, quick, easy, transparent and personalised service.
“The core company values and customer focus of SA Home Loans aligns with that of Capitec Bank,” said Fourie.
The product will be the same as that which is offered by SA Home Loans, and will be available to new bond applicants as well as Capitec clients with existing home loans who would like to benefit from switching their bonds to SA Home Loans.
“Whilst this boosts our product offering and brings us closer to becoming a one-stop solution for clients, the agreement expands distribution for SA Home Loans through most of our over 630 branches,” Fourie said.
In a Sunday Times interview at the weekend, Fourie said Capitec had weathered the unsecured lending storm through responsible lending.
“We don’t lend to social grant recipients. We have a large chunk of retail funding, and our provisioning is far more conservative.”
This has ensured resilience and ability to continue growing profit in an industry dogged by massive debt write-offs.
Although Capitec’s board presented a strong story, some analysts at Friday’s annual general meeting remained concerned about the outlook for a major player in an industry that is overshadowed by extensive write-offs at African Bank, which dominates the market with a 35% share.
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