Business Model of Capitec

1267 Words6 Pages
Critical elements of the Business Model of Capitec Bank. A business model is a story that explains how a business works and answers key questions: • Who is the customer? • What does the customer value and • How will money be made in the business (Magretta, 2002). The business’s primary concern is therefore creating value and capturing the return of the value created. The following model depicts the critical elements capturing value to the customer and the return thereof: Business Model Framework Capitec has a technology driven business model serving the low income population in South Africa. The model caters for people who are employed but are unbanked (Naspers Limited, 2014). Strategic Partners and Alliances Capitec’s strategic partners are retail giants Shoprite, Pick ‘n Pay, PEP, Boxers and Checkers. These stores’ location are closely located to the Capitec’s market segment, that is, financially excluded people living in the townships and rural areas. The benefit of using these retail giants are that the customers can draw cash at the till points, allowing easy and convenient access to their money. This strategic coalition with the retail partners has provided value to Capitec’s customers as most of these customers had no means of transport (Naspers Limited, 2014). Market/Customer • Market Segment Capitec’s target market is the low income earning segment and the unbanked population of South Africa. Their target market are people that have jobs and earn an income, but are unbanked. Most of Capitec’s customers do not have transport, are financial illiterate and are therefore not the type of customers to be targeted by major banks. Capitec saw this gap in the market and made a first move approach on this segment (Naspers Limited, 2014) . • Products and Services The bank offers a low cost offering, known as the Global One,

More about Business Model of Capitec

Open Document