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Pepkor Group, the South African investment company linked to Christo Wiese, is in talks to launch a zero-fee banking service inside its 6,000 stores, according to people familiar with the matter. The plan aims to reach millions of lower-income customers who already rely on the company’s discount outlets.
Talks with investec still underway
Pepkor is in discussions with Investec about a possible partnership, though the people said the outcome is not guaranteed. The project, expected to operate under the name “Pep Bank,” would see profits shared between the retailer and Investec, which has traditionally focused on high-net-worth clients in South Africa and the UK.
By opening banking counters in existing stores, Pepkor would be able to expand quickly at relatively low cost. The retailer also holds years of customer data from its operations, which could help shape savings tools, small loans, and other basic services designed for households that are often overlooked by large banks.
Investec has been looking for new lines of income as South Africa’s economic growth remains weak. It has also been courting clients from bigger rivals and investing in systems that support high-volume transactions for businesses. Pepkor said it has no formal bank partnership “with any bank” and declined further comment. Investec also declined to comment.
A crowded market for low-cost banking
Capitec Bank, the country’s largest lender by customer numbers, continues to draw millions of lower-income depositors and posted another record profit in September. Retailers such as Shoprite Holdings are also using loyalty data to offer financial services to South Africans who either lack a bank account or struggle with limited access.
Many retailers already provide basic services — including bill payments, money transfers and cash withdrawals. Pepkor’s Fintech unit has become a growing contributor, with revenue rising 35 percent to R7.9 billion ($460.2 million) in the six months through March, making up 16 percent of total sales.
Pepkor’s expanding footprint
Pepkor, listed on the Johannesburg Stock Exchange, operates clothing, footwear, homeware, furniture and appliance chains. The group traces its modern structure to 2014, when Wiese sold Pepkor to Steinhoff International in exchange for a 20 percent stake.
Earlier this month, Pepkor completed a R1.7 billion ($99 million) acquisition of Durban-based Retailability’s fashion brands, expanding its adult clothing footprint across Southern Africa and lifting its total store count to 5,899. The deal strengthens the retailer’s supply chain, procurement scale and financial services reach.
