Capitec to Expand Branches and ATMs as Rivals Scale Back

Capitec founder Michiel Le Roux is steering the bank toward further branch and ATM expansion in 2026, defying an industry wide retreat from physical banking infrastructure.

The retail bank says it expects a net increase in both branches and branded ATMs next year, pushing against an industry trend that has seen South Africa’s largest lenders close hundreds of locations and remove thousands of machines. Executives argue that despite rapid growth in digital banking, physical access remains central to Capitec’s low cost, high volume model.

South African Reserve Bank data shows that mobile and internet banking transactions have grown at double digit rates since the pandemic, while cash withdrawals have largely stagnated or declined in value. Many banks have responded by accelerating branch closures to cut costs. Capitec has taken a different path, adding about 3,800 ATMs since 2019 and steadily growing its branch network, a strategy matched only in part by First National Bank.

Capitec now operates more than 860 branches and roughly 8,500 branded ATMs nationwide. Expansion has gone hand in hand with relocation, with sites shifting toward busy retail centers and transport corridors as commuting and shopping patterns evolve. Management says the goal is to remain close to customers in lower income and peri urban areas where smartphone access, data costs and digital confidence still limit a full shift to app based banking.

With a client base exceeding 25 million, the bank positions its branches less as transaction counters and more as support hubs. Staff are trained to help customers learn digital tools while still providing assisted services. Statistics South Africa household finance surveys suggest that around 60 percent of low income earners continue to withdraw most of their income in cash, reinforcing the case for maintaining widespread cash access points.

Capitec acknowledges the tension between promoting digital banking and investing in cash infrastructure. Executives describe the approach as a dual-track strategy that reflects uneven digitisation across provinces, particularly in township and rural economies where cash remains dominant in daily trade.

Beyond traditional banking, the group is also moving to turn selected branches into multipurpose service centers. Capitec is joining a revised partnership with the Department of Home Affairs that integrates government systems directly into bank branches. The updated model, launched in August 2025, avoids the duplicate staffing and equipment that made earlier pilots costly.

The bank plans to activate smart identity card services in about 100 branches by mid 2026, with expansion to roughly 300 branches by year end. Customers will pay a R10 administrative fee in addition to the state-set R140 charge for a smart ID card. Management expects the service to boost foot traffic while aligning banking with public service delivery.

Capitec’s infrastructure push highlights its competitive positioning. While many rivals reduce physical networks to cut costs, the bank is wagering that accessibility, combined with its operational model, remains a viable strategy across South Africa’s varied economy.