Capitec is about to scrap free airtime and electricity purchases
- From 27 June, Capitec will begin charging 50c for each purchase of airtime and electricity through its app, internet, and mobile banking channels.
- Other major banks charge between R1 and R2.70 for similar transactions on their entry-level accounts, though FNB will have free airtime purchases soon.
- Capitec said its costs have gone up significantly as its customer base has grown.
- For more stories got to www.BusinessInsider.co.za
The days of free airtime and electricity purchases on Capitec’s app are just about over.
The company announced this week that it’s implementing a 50c flat fee on all purchases of airtime and electricity through its app, mobile, and internet banking channels.
The fee also applies when clients buy prepaid data, and SMS bundles.
The charges come into effect from 27 June.
“Capitec has always offered clients the ability to buy prepaid airtime and electricity from the app without taking any margin on these transactions,” said the bank's executive of marketing and communications, Francois Viviers, in response to questions from Business Insider South Africa.
See also: Capitec just announced a 100% refund on interest for payment holidays – and you can still apply
“The reality is however that there are costs to facilitate prepaid purchases and these transactions have increased significantly as our app client base has grown over the past couple of years.”
Viviers pointed out that Capitec, not its customers, carries the cost of the data used when they access services via is app.
The flat fee, the bank says, means customers know exactly what they pay.
Other major banks have different approaches to charging for such purchases, on accounts comparable to Capitec's low-cost offering.
Standard Bank charges R1.20 for airtime top-ups and R1.50 for electricity purchases on its entry-level accounts.
Nedbank charges R1.50 for both airtime and electricity transactions on entry-level accounts, while Nedbank charges R1 for both kinds of transactions on entry-level accounts.
First National Bank will drop the fees for airtime purchases on its entry-level accounts in July, but charges R2.70 per transaction for electricity purchases on those entry-level accounts.
Meanwhile, cheap share purchases are coming to the Capitec app
The low-cost investment platform EasyEquities on Thursday announced it had closed a deal with Capitec to provide “investing services” on its app.
EasyEquities allow users to buy shares at a low cost, starting at only 64c per R100.
Capitec has some 3.3 million app users, while EasyEquities have almost 450,000 clients.
In 2017, Sanlam bought a 30% stake in EasyEquities for R100 million. It has since agreed to a couple of cash injections since to keep it afloat.
(Additional reporting by Helena Wasserman and Phillip de Wet)
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