Prime Highlight
- Pepkor received regulatory approval to enter the banking sector, planning to launch a new venture, potentially named “Pep Bank,” in partnership with Investec.
- The move strengthens Pepkor’s mission to offer financial services to millions of underserved and underbanked customers across South Africa and the region.
Key Facts
- Pepkor’s fintech revenue rose 31% to 16.6 billion rand ($961 million), representing 17% of total sales, while the company operates over 6,000 stores.
- The retailer is acquiring Retailability for R1.7 billion, adding 462 stores across five southern African countries, with completion expected in Q1 FY26 pending approval.
Background
Africa’s largest clothing retailer, Pepkor, has secured regulatory approval to enter the banking sector, marking a major step in its push to offer financial services to millions of underserved customers. The South African company is preparing to launch its own banking venture after acquiring a fintech software platform last month to support the expansion.
According to Bloomberg, Pepkor is in talks with Investec to create a new banking operation that may be called “Pep Bank.” The two companies are expected to share profits from the venture. The move places Pepkor among a growing group of South African retailers, including Shoprite, that are using customer data and loyalty programmes to offer financial services to nearly one-sixth of South Africans who remain unbanked or underbanked.
Pepkor’s fintech unit has become one of its strongest growth drivers. Revenue from the segment rose 31% to 16.6 billion rand ($961 million) for the year ending September, accounting for 17% of overall sales. The company currently operates more than 6,000 stores and sells mobile devices while also offering financing through its Pep and Ackermans brands.
The retailer is also expanding rapidly. It recently announced a R1.7 billion acquisition of Retailability, which adds 462 stores across South Africa, Botswana, Lesotho, Namibia, and Eswatini. The deal, which represents less than 2% of Pepkor’s market capitalisation, will be paid in cash and is expected to close in the first quarter of FY26, pending Competition Commission approval.
CEO Pieter Erasmus said Pepkor is building “a unique position of trust” among millions of customers by focusing on digital inclusion and financial technology. Shares rose 3.8% in early Johannesburg trading after the update, signalling investor confidence despite a year-to-date decline.
Pepkor’s growing fintech and retail network positions it to reshape how lower-income consumers access both banking and shopping services.
