The news: Pepkor launching an assault on SA's R900 billion informal sector. The Reserve Bank just threw cold water on the crypto party, warning that stablecoins and digital assets "imperil financial stability" (their words, not ours). Meanwhile, R63 billion has quietly externalised through local crypto platforms since 2019, flows that currently fall outside exchange-control reporting. Whoops.

Plus, AXIAN just rebranded its entire fintech arm across five African countries, because apparently mobile money wasn't ambitious enough. They're going full digital banking now.

Let’s get into this week’s edition.

 GOLDEN NUGGETS

• SARB warns crypto imperils financial stability – Reserve Bank flags that R63bn externalised through crypto platforms since 2019, falling outside exchange-control reporting; 8 million South Africans now have crypto-trading accounts, double since early 2022

• Pepkor's fintech Flash targets 175,000 informal traders – SA's largest retailer gears up for full banking licence onslaught on R900bn informal sector; 80% of businesses unregistered, making access to finance nearly impossible

• Capitec and FirstRand near R500bn valuations – Capitec surges 150% over five years to R463bn valuation with 25 million clients; FirstRand up 73% to R466bn; competition heats up fuelled by fintech and value-added services

• AXIAN rebrands fintech arm as AXIAN Digibank & Fintech – Pan-African group shifts from mobile money to full digital banking ecosystem across Madagascar, Comoros, Tanzania, Togo, and Senegal; targets individuals and SMEs demanding credit, savings, and investment products

• Black Friday 2025 smashes records: SA's e-commerce revenue hits R130bn, with single transactions reaching R1.1m (travel) and R500k (retail). Online sales growing at 38% annually vs traditional retail's 2.5%. Peach Payments and Discovery Bank dashboards showed transaction volumes double 2024 levels.

Main Stories

Pepkor’s Flash: Billion Rand Informal Sector Landgrab

What’s happening: South Africa's largest retailer Pepkor is gearing up for a full-throttle onslaught on the banking sector, leveraging its 17-year investment in fintech group Flash, which now serves 175,000 informal traders across the country.

Why it matters: Whilst everyone's been watching the Big Four banks and digital disruptors like TymeBank battle it out for retail customers, Pepkor's been building infrastructure for South Africa's R900 billion informal economy – a sector that traditional banks have comprehensively failed to serve.

Here's the kicker: according to a Standard Bank study, 80% of businesses in the informal sector are unregistered, making access to finance to grow their enterprises nearly impossible. The survey focused on businesses raking in R100,000-R50 million annually across Gauteng, Western Cape, KwaZulu-Natal, and the mineral-rich North West. That's a massive chasm.

State of play: Flash collaborates with top brands and businesses to offer quality products and services to the informal sector. With cash still king in this segment, the company has been gaining traction through connectivity and smartphone access to extend reach beyond traditional retail.

The competition? Capitec has already made a foray into business banking, looking to disrupt lending to small businesses, particularly in the informal economy. The bank has taken the fight to fintech payment platforms like Flash, Yoco, and iKhokha by slashing costs of its point-of-sale machines.

Catch up: The informal economy's banking problem
Informal businesses can't provide the documentation banks require: no formal registration, no tax records, no audited financials. Traditional credit scoring doesn't work. So banks often shrug and walk away.

Enter fintechs like Flash, which have spent years building distribution networks, understanding cash-flow patterns, and developing alternative credit-scoring mechanisms that don't require years of audited accounts.

Zoom in: The Pepkor advantage
Pepkor isn't starting from zero. Flash has been around for 17 years, building relationships with 175,000 traders. The retailer understands supply chains, knows how informal businesses operate, and has physical presence through its retail footprint (think Ackermans, PEP, Shoe City, Tekkie Town).

That's powerful infrastructure to layer banking services on top of. Imagine a spaza shop owner who buys stock from Pepkor on credit, uses Flash to process customer payments, and gets working capital loans based on transaction history – all in one ecosystem. It’s what I think Nedbank and Ikhoka will likely do.

The play mirrors what M-Pesa did in Kenya: start with payments, build trust, add financial services. Except Pepkor has retail muscle that M-Pesa never had.

Be smart: The R900 billion informal sector isn't winner-takes-all. It's fragmented, diverse, and resistant to one-size-fits-all solutions. Flash's 175,000 traders sound impressive until you realise there are 525,000 businesses in South Africa with turnover of R30m-R1.5bn alone.

Of course competition will be brutal. Capitec's disrupting business banking, Nedbank just bought iKhokha for R1.6bn, and mobile money operators like MTN MoMo and Vodacom VodaPay are eyeing the same space.

Black Friday's Digital Triumph

Why it matters: South Africa's e-commerce sector is fundamentally reshaping how a nation of 60 million people shops, pays, and expects service. When a single travel transaction hits R1.1 million and online sales grow at 38% annually whilst traditional retail limps along at 2.5%, you're witnessing a structural reset, not a trend.

State of Play: By 9am on Black Friday, Peach Payments' live dashboard was already telling the story: R380,000 in travel, R336,000 in retail, both in single transactions. Discovery Bank clocked a R500,000 card purchase by 11am. By day's end, transaction volumes had doubled year-on-year, with the Western Cape accounting for 65% of Peach's value and Gauteng contributing 34%.

The numbers get more interesting when you zoom out. South Africa's e-commerce revenue is projected to surpass R130 billion by end-2025 - approaching 10% of the national retail market. That's a tenfold increase from the 8% penetration RMB forecast just a few years ago, when the bank predicted R225bn by 2025.

So What: The pandemic was the accelerant, but the fuel was already there. South Africa's retail landscape has been quietly digitising for years:

• Mobile-first shopping: 72.43% of transaction value now comes from smartphones, growing at 11.52% CAGR

• Payment diversity: Credit/debit cards, digital wallets, Buy Now Pay Later, and EFTs have become table stakes

• "Phygital" strategies: 57% of consumers now research online before buying in-store (up from 42% in 2022)

• Black November: The single day became a month-long season, with banks processing R30 billion in transactions
  Zoom In: The real story isn't the numbers, but what's enabling them:

  Payment infrastructure maturity: When Discovery Bank can process a R500k card transaction seamlessly and Peach can handle double the previous year's volume without breaking, you're looking at genuine infrastructure resilience. Near-perfect uptime during Black Friday isn't a nice-to-have; it's the price of admission.

Policy Watch

+This

28 November 1907

On this day, the Bankers' Trust Company was established in New York with an initial capital of $1.5 million. Created specifically to handle trust accounts for commercial banks, it became one of the most influential financial institutions of the 20th century.

The timing was impeccable. Just weeks earlier, the Panic of 1907 had nearly collapsed the US financial system. J.P. Morgan locked bankers in his library and forced them to pool resources to prevent total meltdown. The crisis exposed how fragile American banking was – and Bankers' Trust emerged from the chaos as a new model.

That's your week in banking & fintech.

See you next time for more insights, trends, and the occasional regulatory curveball.

The Banking Brief is your weekly guide to the world of fintech and banking. We break down complex financial news into digestible insights for execs who want to stay ahead. All views are our own, not financial advice.