The SA Reserve Bank has written to the National Credit Regulator requesting a probe into loan-origination fees charged by Capitec Bank, according to a person familiar with the matter.
The referral came after the issue was raised in a report by short-seller Viceroy Research in January, said the person, asking not to be identified because the matter is private. The investigation is ongoing, the person said. Capitec Chief Financial Officer Andre du Plessis said he was unaware of the central bank’s referral, or of an investigation by the Johannesburg-based NCR.
In the report, Viceroy said Capitec’s income was boosted by excessive fees on its multi-loan product, which carried a monthly charge for allowing a previously vetted customer to extend their facility by answering some questions. While Capitec said it terminated the product in 2016, after rules introduced by the NCR meant it was no longer viable, Viceroy said the lender rebranded it and that Capitec’s methods risk over-indebting consumers.
