South African banks are worried about Discovery’s entrance into the banking market, as it will be disruptive.
This is according to Discovery CEO Adrian Gore, who was speaking to Forbes Africa about their banking plans.
In October, Discovery received its banking licence from South Africa’s Registrar of Banks.
This paves the way for the company to launch commercial banking services in South Africa in 2018.
Discovery has been working on its bank for two years, and Gore said it has progressed well.
They now have a strong team of people on the project and the company is already interacting in the payment space.
The Discovery Bank is being built from the ground up, and around R1.5 billion has been invested in the project.
Gore said the investment is needed to ensure they build the best platform to serve customers, without taking any shortcuts.
“The value proposition itself will be good for customers. I mean, that is what we do,” said Gore.
He said using incentives to change behaviour where people are often irrational works well, and they think they can add value with their model of sharing value and creating behaviour change.
Discovery Bank will target the “mass affluent market” in South Africa, which Gore said covers “a low LSM right the way to the top”.
Gore said their focus is on customers and offering them a value proposition which makes sense.
“It is simple – if you meet people’s needs, they buy your products.”