Digitally-enabled companies have transformed the banking landscape. But sustaining success takes more than tech, says Capitec boss Gerrie Fourie.

Who’s the CEO in your organization? Perhaps it’s you. Perhaps it’s your boss, or maybe someone two or three levels above where you sit today. But put that question to Gerrie Fourie of Capitec Bank, and he is likely to give you a very different answer. Formally, of course, he is the person in charge of the fast-growing South African retail bank. But he points to his people.

“We believe every single person is a CEO,” says Fourie. “The C stands for client, the E for energy and the O is for ownership.” The answer is more than a throwaway management soundbite. It reflects an unwavering belief about what makes a successful business, and crystallizes Fourie’s determination to make sure that Capitec focuses on the needs of its customers at all times. “If you look at a small business, that small business owner is a CEO of his business,” explains Fourie. “He is totally focused on satisfying his clients, and he’s got high energy and high ownership.”

That is the mindset Fourie seeks among his organization’s employees. “Our culture is all about the client, our people and delivery,” says Fourie. The question for leadership is simple, he says: how do we balance those three factors? Everyone in the bank has a role to play in answering it. “I want every single person here to feel that ownership and drive the vision of the bank. I think that is critical.”

That empowering vision is a significant part of the way Capitec has thrived in the 22 years since it was founded – and how Fourie believes it will continue to thrive in the years ahead. In 2022, Capitec reported a customer base of 19 million people, with almost 11 million on its digital platforms, buying into the company’s promise of simplified banking. It is an impressive track record.

Yet, for any fast-growing firm, the transition from nimble start-up to life as a larger, more complex organism is a challenging one. Pitfalls abound. Fourie points to one of the classic dangers: the tendency for red tape and bureaucracy to proliferate and smother the very dynamism that drives growth. “It’s typical for businesses as they become bigger,” reflects Fourie with a wry smile. “You start getting more committees and more structures and more delegation of authorities and all of this nonsense.”

Is preserving the speed and agility that define a company’s early years a realistic goal? Fourie is emphatic. “If you don’t deliberately work on it, you’re going to be in trouble.” Change is both inevitable and necessary for managing the realities of life as a big business, but that makes it all the more important to prevent a slide into unnecessary bureaucracy. “We’re much bigger and much slower than we were ten years ago,” Fourie admits. “You need to deliberately work on it to make certain that you’re challenging yourself on it.”

Without that, warns Fourie, people begin to relinquish ownership, their energy fades and their sense of initiative evaporates. “You can easily fall into the mindset of, ‘I’m not going to make a decision, that committee is going to make a decision,’” says Fourie. “You must make a choice.”

Decision-making accountability

The ways that decisions are made is at the heart of Fourie’s vision for how Capitec works. He is clear that leaders have a responsibility to hold people to account – without paralysing them with worry about the consequences of coming up short.

“You want people to make decisions,” he says. “But you need to take the fear of failure away.

“What I always say is, when you take a decision, just give me two or three reasons why you’re making that decision, so I can challenge you on it,” he continues. The test is: has the client been taken into consideration? Have the organization’s people? When things go wrong, says Fourie, leaders’ responsibilities are simple. “If it’s the wrong decision, just go out and admit it and correct it.”

That is especially important for a growth business that has followed a trajectory like Capitec’s, using digital technology to disrupt the business models of the established banks. “We’ve got a very strong innovation culture of doing things differently, challenging the norm and looking at new opportunities,” says Fourie. It has been baked into the bank’s DNA over the last two decades as it learned to compete with bigger rivals. “You haven’t got the same money, you haven’t got the same resources, so you think differently. It comes back to being agile and flexible.”

Maintaining that spirit of innovation and finding opportunities for growth makes it essential to truly understand customers and how they might respond to new service offerings. “I always say that if you want to differentiate a service or product with 3-4% difference, it’s extremely difficult to sell. Differentiated by 30%, it’s a different story,” he says. That brings its own challenges. “To get to 20-30% differentiation you really need to unpack a product from A to Z and think completely differently.”

“You can’t innovate and find solutions if you’re not positive. If you’re negative, you just see problems and waste all your time on negative things.”
– Gerrie Fourie, Capitec chief executive

That also demands a positive mindset from leaders. “You can’t innovate and find solutions if you’re not positive,” observes Fourie. “If you’re negative, you just see problems and you waste all your time on negative things. I try to get my mind on positive things and try to find solutions in those areas.”

Points of differentiation

(left) Capitec branch (right) Capitec headquarters in Stellenbosch.

Capitec is among the generation of fintechs that emerged around the world over the past two decades and have flourished thanks to a potent combination of slick technology and a fresh focus on customer needs. Industry incumbents have seen their old models disrupted and been forced to learn lessons from their young challengers. The net effect is that many firms now follow broadly similar strategies, says Fourie. “If you look at banking companies, they’ve all got the same strategies – client satisfaction, changing digital technology, bringing payments out, and so on.”

Capitec’s strategy is crystal clear. “We’re creating very simplistic, transparent, affordable banking for 95% or 96% of South Africans,” says Fourie. “The 5% that are looking for specialist services can go to specialized banks.”

But if strategy is no longer the key competitive differentiator, what is? “It’s the execution of your strategy and getting client acceptance that makes the difference,” says Fourie. That has clear implications for leaders throughout a business. “You need to be able to go into the detail of the strategy and make certain that people understand it and that it’s executed correctly. That’s where a lot of leaders fall down – on the execution of strategy to the lowest level.” That insight shapes how Fourie sees the role of leadership. “There’s really two components,” he says. “The ability to explain the ‘Why’ – why we do something, and that comes back to the strategy.” The other fundamental component is to have robust conversations about performance. “Those honest conversations are the backbone of any organization,” he says.

Another key part of the success of financial services firms like Capitec is their technology stack and how it is deployed to serve customers. “The client wants financial services in their pocket,” says Fourie. “How do you bring your services to their pocket with an app in a way that puts them fully in control? We’re very strong on simplicity and transparency that puts the client in control.”

“There is still a big element where a client wants to connect with an individual. You need to bring the human being and the digital side together.”
– Gerrie Fourie, Capitec chief executive


Fourie believes human contact is still essential. “There is still a big element where a client wants to connect with an individual,” he says. “You need to create that ability for the client, if he’s uncomfortable or he’s not feeling 100% in control, to connect with an individual who can give him the right information and give him the confidence to do the transaction. You need to bring the human being and the digital side together.”

Of course, digital is also transforming the processes that underpin business operations. “Everyone talks about the digital experience of the client, but the technology on the infrastructure side is changing tremendously too,” says Fourie. There has been a rapid switch to cloud across the financial services sector, for instance. “People forget about technology on the infrastructure side, but it enables you to do certain things for client experience,” he continues. That could be the capability to talk to clients on a real-time basis, or to use GPS to see where a client is and help them with a particular problem. “You need to look at technology in totality, and not only at a particular component.”

Surveying the landscape

Fourie at Capitec’s 2022 Senior Leaders Summit.

Technology is just part of a broader transformation. “Banking used to be banking, but it’s actually moved on to financial services – it’s far more than just pure banking,” says Fourie. That changes the competitive landscape. “You need to look at what the banks are doing, what the mobile companies are doing, and you need to look at what the Apples, the Googles, the WhatsApps and Facebooks are doing. You need to look at all these potential competitors; you can’t just have a banking hat on.” Capitec has teams focused on all three areas. “And we travel quite a lot to get first-hand experience,” he says.

Indeed, that outward-looking mindset helped shape Capitec’s recent leadership program with Duke Corporate Education. Aiming to enhance leaders’ ability to think strategically, the program saw a cohort of leaders head to Indonesia and Singapore to spend time with local companies. “To see what other companies are thinking, or to see what other companies’ cultures are, opens your mind,” says Fourie.

International exposure doubles the benefits. “When you go abroad, you get a completely different perspective on how people live, what their needs are and whether those needs are being satisfied,” he adds. While leaders are now used to connecting online, Fourie still believes that person-to-person contact is best.

“Just before Covid, I was in China,” he recounts. It was eye-opening. “It’s one thing to talk to Tencent and WeChat and all those companies, but then you need to go and see how clients are experiencing them in practice. That’s the connection that you need to put together – otherwise, it’s just theory.”

The courage to say no

What else will determine the success of financial services business in the coming years? Fourie highlights the need for clarity about business priorities. “Probably the biggest challenge for leaders today is to say ‘No’, because there’s so many things that you can do. What is the right thing to focus on?”

That hinges on understanding customer needs. The new orthodoxy is that data reveals what people want, and of course that has its place. But Fourie points out that real, nuanced human insight is still needed. “You need to spend hours and hours debating what the client need really is. I don’t think people spend enough time on that,” he says. His perspective was shaped by his earlier career experiences. “When I was setting up ops, I used to spend two weeks a month in the field, working with the client. I miss that!” he says. “You need to have that passion for your client.”

How does a company achieve that level of focus? “We’re debating it every single day because there’s hundreds of products that you want to bring in,” says Fourie. He is clear that’s not an option. “I’d rather focus on one or two products and get to a 30-40% market share, than have ten products and a 5% market share per product. That is the focus. It’s that ability to have one or two products – and provide end-to-end client experience.”

Leaders need to ensure that focus extends to their teams. “We don’t spend enough time with our people saying, ‘These are the one or two things that you really need to focus on,’” reflects Fourie. “We leave it up to them to prioritize, and then they get pressure from everywhere and they’re trying to do everything. That’s when they fail.”

That clear-eyed focus on business priorities, combined with the levels of empowerment that come with a mindset of creating CEOs at every level in the business, has helped Capitec thrive over the past 22 years. It looks set to help it flourish in the years ahead.

Patrick Woodman
Patrick Woodman
Editor of Dialogue