“We’re building a digital bank on this side and they’re building a lending platform. Now, I’m not saying it’s going to happen but the aim is to merge the two in a couple of years from now. Then we don’t need to have a bricks and mortar [bank] in a different country,” said chief executive Gerrie Fourie.
Capitec, renowned for disrupting the South African banking industry, previously announced that it will acquire a 40% stake in Creamfinance for €21 million.
Fourie, who described Creamfinance as a “young, dynamic company” similar to Capitec circa 2001/2002, said the deal provides Capitec with an opportunity to learn and understand how to operate in foreign markets.
The online lender, founded in Latvia in 2012, operates in six countries and could possibly extend its services into 30 markets, he said.
Renier de Bruyn, an investment analyst at Sanlam Private Wealth, said the first benefits for Capitec would be learning how to operate in a completely online environment, gaining insight from Creamfinance’s advanced credit underwriting methods and experience in foreign microlending markets.
“It’s a very small deal as the €21 million purchase price makes up around 0.3% of Capitec’s market cap. They’re also taking a very cautious approach by investing in tranches. But it’s a very exciting step that they’re taking entering international markets,” he added.
Capitec continues to make strides in South Africa, growing its client base by a record 1.3 million to 8.6 million active clients during the course of the financial year ended February 28 2017.
The online lender, founded in Latvia in 2012, operates in six countries and could possibly extend its services into 30 markets, he said.
Renier de Bruyn, an investment analyst at Sanlam Private Wealth, said the first benefits for Capitec would be learning how to operate in a completely online environment, gaining insight from Creamfinance’s advanced credit underwriting methods and experience in foreign microlending markets.
“It’s a very small deal as the €21 million purchase price makes up around 0.3% of Capitec’s market cap. They’re also taking a very cautious approach by investing in tranches. But it’s a very exciting step that they’re taking entering international markets,” he added.
Capitec continues to make strides in South Africa, growing its client base by a record 1.3 million to 8.6 million active clients during the course of the financial year ended February 28 2017.
