The World Economic Forum recently highlighted estimates that less than half of South Africa's 5.78 million small and medium-sized enterprises have a bank. The main reason for this is high banking and transaction fees, but that is only one of the reasons.
Approximately 85% of South Africans have a bank account, the highest banking penetration rate in Africa, but many are used to cash out social security grants rather than for transactions.
Overall, wariness about digital payments remains strong, meaning many small and medium-sized businesses rely heavily on cash.
This not only raises security concerns; The costs associated with moving physical cash into the banking system to pay suppliers are much higher.
To break down these barriers, Capitec Business has introduced a more affordable banking solution for SA businesses with new pricing from 1 March 2024.
The bank has reduced its business banking fees to a flat monthly fee of R50, the same as the transaction fees that apply to its 21 million personal banking customers, regardless of the size or type of business.
Capitec CEO Gerrie Fourie said one of the aims of the new pricing structure for SMEs is to stimulate growth in SA, particularly in light of the economic challenges outlined in the 2024 Budget Speech. says.
“We believe that by helping small businesses grow, they create job opportunities and drive economic growth,” Foley said.
“We understand the challenges that businesses face through traditional banking. Traditional banks favor those who are successful. The largest, oldest, most successful companies service, best credit, and often at the best price.
“That's why we're focused on providing simple, transparent and affordable banking that can reduce fees by up to 50% with no hidden costs. It helps us manage our businesses efficiently, invest in growth and create much-needed job opportunities.”
New fee structure
The new pricing regime, which comes into effect from March 1, will save businesses up to 50% on regular rates.
- Free virtual cards for online transactions
- No fees for paying with local card
- R1 for payments and transfers to other Capitec accounts
- R2 for payments and transfers to other banks
- 50 per debit order
- 50 for immediate payment;
- The monthly fixed fee is as low as R50.
There are also some relief measures for small and medium-sized businesses that primarily transact in cash, such as a fee of R1.20 per R100 spent at cash-enabled ATMs.
Capitec account balance inquiries are free and SMS notifications cost R0.35 each.
Foley said it was always Capitec's intention to disrupt business banking fees in the same way it disrupts personal banking through affordable, low-fee services.
Extending low-cost services to businesses is a logical move based on direct feedback from customers.
“We took the time to understand our client's needs and preferences, and the results are clear: our clients enjoy a simple, cost-effective fee structure that is easy to understand and does not discriminate by size. We want a simple solution with Hooley.
“While our research showed businesses are prepared to pay more, we are determined to lead in value and offer the most affordable full-service business banking on the market. We have significantly lowered our fees to provide a solution.”
This low-cost service is part of a digital strategy that aims to deliver 80% of banking services online or via apps, without losing the personal touch. To do this, we needed to simplify the registration process and make it easy for businesses to transact online, whether they need foreign exchange, overdraft or asset financing.
Digital banking services
The bank's digital strategy is to bring more services online.
New customers can open a business bank account online or via app in minutes without any paperwork.
Then, you and your existing customers will be able to enjoy the following benefits:
- You can access digital banking for free through the app or online portal.
- Personalized service and support from a relationship banker.
- Quickly approve overdraft or real estate or asset financing applications.
- Foreign exchange services, rental financial solutions and payment services.and
- A new generation of touchscreen card machines is being delivered to small and medium-sized businesses with a lower fee structure and free same-day payments 24/7.
“Capitec has evolved from a retail bank to a financial services company with the purpose of helping customers live better lives through the innovative use of technology and data,” Foley said.
“While we believe Capitec Business is a major milestone on this journey to create incredible value for businesses, we are committed to continuing to innovate and pioneer solutions that help our customers live better lives. We're not done yet.”
provided by Capitec Business Banking.
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