South Africa’s biggest bank is going international

South Africa’s biggest bank is going international as Capitec Bank sets its sights on expanding beyond local borders. With over 25 million customers and a market cap of R400 billion, Capitec has already established itself as a dominant force in South Africa banking. Now, with promising growth from its international subsidiary AvaFin, the bank is laying the groundwork for global expansion, though still in its early stages.

Capitec Bank’s Dominance in South Africa

Capitec Bank has transformed into South Africa’s largest bank by customer numbers, surpassing long-established competitors such as FirstRand, Standard Bank, Nedbank, and Absa. The institution’s straightforward banking model, affordable fee structure, and customer-first approach have allowed it to grow rapidly in both urban and rural markets.

Capitec’s dominance is reflected in its 26% increase in headline earnings, reaching R8.0 billion for the six months ending 31 August 2025. These results underline its strong financial base, which provides the leverage it needs to pursue new international expansion opportunities.

AvaFin Growth: A Stepping Stone to Global Reach

One of the biggest contributors to Capitec’s rising earnings has been AvaFin, a digital loan provider operating in Mexico, Poland, Spain, Czechia, and Latvia. Capitec increased its stake in AvaFin from 40% to over 95% in 2024, giving it a near full controlling interest in the international venture.

In the most recent reporting period, AvaFin contributed R121 million to Capitec’s headline earnings. With 250,000 active clients and €303 million in loans advanced—up 94% from 2024—AvaFin has become a key growth engine for Capitec. Although AvaFin’s earnings only make up about 2% of the group’s total, the trajectory signals strong potential for long-term international success.

This AvaFin growth demonstrates how Capitec is already testing its model outside of South Africa, giving it a platform to learn, adapt, and position itself for a wider global footprint.

CEO Graham Lee on International Expansion

Capitec’s Group CEO, Graham Lee, emphasized that while the group is determined to grow internationally, the international expansion is still in the early phases. Speaking to BusinessTech, Lee said that Capitec envisions building a recognizable global brand, though no final decisions have been made on which new markets to target next.

Lee’s personal experience plays a crucial role in shaping these ambitions. Having worked in Zimbabwe, Nigeria, the UK, and Australia, he brings valuable insights into the complexities of operating in diverse regulatory and economic environments.

Global Banking Context: Why Expansion Makes Sense

South Africa’s sluggish economic growth and high competition in the domestic market have motivated several banks to look abroad. Standard Bank has expanded into 20 African markets, FirstRand has significant investments in the UK, and Nedbank has built relationships across the continent.

For Capitec, international expansion offers a way to diversify its revenue streams, reduce dependency on South Africa’s low-growth environment, and capitalize on opportunities in high-growth emerging markets. AvaFin’s performance suggests that digital financial services can thrive beyond borders, and Capitec intends to leverage this experience.

Core Businesses Still Take Priority

Despite the buzz around going international, Capitec remains committed to its five core business units:

• Retail Banking

• Fintech and Value-Added Services (VAS + Capitec)

• Insurance

• Business Banking

• AvaFin (International operations)

The South Africa banking giant acknowledges that many of these divisions are still relatively small compared to retail banking. For example, its business banking arm holds only a minor share of the market, though growth in this sector remains a strategic priority.

Capitec Connect and Insurance Expansion

Beyond traditional banking, Capitec has made strides in telecommunications and insurance. Capitec Connect, its mobile network offering powered by Cell C, already has over a million users and is growing rapidly. The integration of telecom services gives Capitec another competitive edge in the digital banking ecosystem.

The bank has also assumed full underwriting responsibilities for its life and funeral insurance offerings. This allows Capitec to capture more value from its insurance products while expanding cross-selling opportunities across its client base.

Human Experience Still Central to Capitec’s Strategy

Interestingly, while many competitors are scaling back physical branches to prioritize digital banking, Capitec is doing the opposite. The bank continues to grow its branch network, emphasizing the importance of human interaction in building trust and customer loyalty.

CEO Lee highlighted that branch visits often lead to digital adoption. Many clients who walk into a branch to resolve an issue end up learning about the Capitec App, which now has over 14 million users, making it the largest banking app in Africa.

By combining strong branch presence with digital tools, Capitec is strengthening its customer engagement model—an approach that could prove effective in international markets as well.

Challenges Ahead for Capitec’s International Expansion

Although the vision is bold, Capitec faces several challenges in becoming a truly global player. These include:

• Regulatory compliance in multiple jurisdictions.

• Cultural differences that affect customer preferences.

• Currency and economic risks in emerging markets.

• Competition from established global and regional banks.

The success of its AvaFin growth story will be critical in proving that Capitec can adapt to international markets while retaining the strengths that have driven its success in South Africa.

Conclusion: A Bank with Global Ambitions

South Africa’s biggest bank is going international, and while the journey is only beginning, the ambition is clear. With AvaFin leading the charge, a strong customer base at home, and diversified business units in fintech, insurance, and telecom, Capitec is positioning itself as more than just a local powerhouse.

The bank’s story reflects both the opportunities and challenges of South Africa banking in a globalized world. If Capitec successfully navigates the path to international expansion, it could redefine not only its own future but also set new standards for other African banks aspiring to compete on the world stage.