Capitec has big plans for its mobile service

Capitec’s mobile virtual network operator (MVNO), Capitec Connect, has grown substantially since its launch in September 2022.

As of November 2024, the MVNO has more than 1.4 million SIMs active on its network and Capitec Connect Head, Dr Dalene Steyn, says it has even more ambitious growth plans for 2025.

“We’re now about 1.4 million active SIMs, so we’re heading to the 1.5 million active SIMs mark, and we’ve got plans to literally double that next year,” Steyn told MyBroadband.

Capitec’s plans to double active SIMs next year will likely benefit from another enhancement to its service — the introduction of eSIMs.

“In my phone, I have a Capitec Connect eSIM, which I’ve been using for a number of months already. It is something that we will be rolling out to our clients next year,” said Steyn.

She added that they can’t provide an exact launch date yet but said Capitec Connect is testing eSIMs and will launch support for the technology next year.

“We were waiting for our clients and the phones that our clients use to be ready for eSIMs. We can see exactly which phones our clients use on our network and on the Capitec app,” she said.

“As the adoption of eSIM is increasing in South Africa, we feel that the time is right now to also offer this to our clients.”

Part of its eSIM plans includes offering customers a “remote onboarding journey” through which they can register, RICA, and activate eSIMs seamlessly without stepping into a Capitec branch.

“We are going to be integrating Connect a lot more into Capitec. Up until now, we’ve had a lot of work to do to establish ourselves as an MVNO,” said Steyn.

The integration could see Capitec Connect customers rewarded with data or minutes for good banking behaviour.

“The reason we started Capitec Connect wasn’t to be the biggest telco. It was to make Capitec a better bank,” said Steyn.

“That’s what we will start doing next year. Imagine having a credit card that’s in good standing, and you get rewarded with Connect data.”

At launch, the MVNO offered data and minutes at a flat rate with bundles that never expired. However, Capitec Connect recently launched 24-hour, 7-day, and 30-day data bundles, which Steyn says have proven popular.

“Since we launched our expiry bundles in July. On the data side, we’ve seen a 61% increase in our data usage and 129% increase in our voice usage,” she said.

“The split is currently that about 65% are expiry bundles and 35% are non-expiry bundles. We’ve seen the no-expiry usage coming down slowly but surely every month.”

Growing from strength to strength

Capitec’s latest annual results for the year ended 29 February 2024 revealed that Capitec Connect generated R35 million in net transaction and commission income during the period.

This came on the back of a R7 million loss the year prior, marking a R42 million turnaround.

However, it should be noted that the R7 million loss only represented its first five months in operation.

Speaking during the company’s annual results presentation on 23 April 2024, CEO Gerrie Fourie said he was very excited about Capitec Connect and that it had several new products planned for launch in the 2024/25 financial year.

Capitec recently released its half-year results for the period ended 31 August 2024, revealing that Capitec Connect contributed R69 million in net income during the period.

It noted that the half-year figure of R69 million was up from R4 million in the same six-month period the year prior.