Happy Sunday. Elly here. Picture Pepkor executives presenting their bank blueprint to investors. Africa's largest clothing retailer - the company behind Pep, Ackermans, and 6,500 stores - just revealed plans for a R1 billion bank launching in 2027. The codename is "plusb". The target: 1.8 million customers earning under R15,000 monthly.

If you enjoy The Banking Brief, please whitelist this email and move it to your primary inbox. If this was forwarded to you, subscribe here.

Onto today’s edition.

💰SARS (South African Revenue Services) hit R2.01 trillion as Chief Whip Kieswetter exits. SARS collected R2.01 trillion in 2025/26 -first time breaking R2 trillion, nearly R25bn above budget estimates. Edward Kieswetter bows out after seven years rebuilding the agency from state capture wreckage, with public trust rising from below 50% to over 70%. Dr Ngobani Johnstone Makhubu takes over 1 May.

🏪 Pepkor will launch "plusb" in 2027 with R1 billion investment, targeting 1.8 million customers earning under R15,000 monthly across its 6,500-store network - breakeven expected by 2030, three years post-launch.

💰 Nigeria's banks raised N4.65 trillion over 24 months with 33 of 37 meeting new capital requirements - 72.55% (N3.37 trillion) came from domestic investors, signalling strong local confidence despite macro pressures.

🇰🇪 Moniepoint acquired 78% of Sumac Microfinance Bank in Kenya, securing deposit-taking licence after years trying to enter East Africa - bypassing Central Bank's freeze on new banking licences.

📈 Neobank Revolut posted $2.2 billion profit in 2025 as subscriptions surged, while Wise opened UK everyday banking accounts to compete directly with Revolut and Monzo in the daily banking market.

Pepkor targets 1.8 million customers for its new bank from 32 million customer touchpoints. What percentage of its existing customer base would need to become "primary banked" customers to hit this target?

A) 1.8%
B) 5.6%
C) 10.5%
D) 17.8%
Scroll down to the end of for the answer.

What's happening: Pepkor will launch its new bank - currently codenamed "plusb" - during 2027, targeting breakeven by 2030, three years after go-live. The retail group identified this opportunity during 2025 and hired Merwe Scholtz to lead the banking push. Pepkor contends that "no bank has entered the South African market with these assets already in place" - specifically 32 million customer touchpoints across 6,500 physical locations, plus decades of building trust, distribution, and customer relationships at scale. The group says due to increasing smartphone penetration, rapidly expanding financial services engagement, and online stores with biometric capability, Pepkor now owns the handset relationship, financial touchpoints, and a credit footprint.

So what. Pepkor is betting that distribution beats product - that owning 6,500 stores where customers already shop, borrow, and buy phones creates stickier primacy than any incumbent's app. The R1 billion investment and three-year path to breakeven mirrors Discovery Bank's timeline (which reached 1.4 million clients in six years). For incumbents: Pepkor's entering with assets that took Capitec and African Bank decades to build - physical footprint in townships and rural areas where branch economics work because retail already justified the rent. For fintechs: this validates the thesis that whoever owns the customer relationship (retail, telco, super-app) eventually adds banking rather than banks adding those relationships. The 1.8 million target looks conservative given Pepkor's 32 million touchpoints, which suggests either cautious projections or recognition that most customers will use plusb for transactions, not primacy.

What's happening. Moniepoint acquired a 78% stake in Sumac Microfinance Bank, securing regulatory entry into Kenya after a previous attempt to acquire payments firm Kopo Kopo stalled. The transaction, approved by the Central Bank of Kenya and Competition Authority of Kenya, marks Moniepoint's first major acquisition on the continent and formal entry into the East African market. Moniepoint now holds majority control of the 20-year-old lender, gaining a deposit-taking licence critical to its credit-led expansion strategy. The move allows Moniepoint to deploy its comprehensive suite of banking, payments, credit, and business management tools to Kenya's 7.4 million MSMEs- a sector contributing 40% of the nation's GDP.

So what. Moniepoint is entering a Kenyan market that differs fundamentally from Nigeria - M-PESA already owns the SME payments relationship, banks like Equity and KCB have deep digital lending infrastructure, and the Central Bank hasn't issued new banking licences in years. Buying Sumac solves the regulatory bottleneck but leaves the harder question: how does Moniepoint's high-volume, credit-led Nigerian playbook work in a market where mobile money penetration is near-universal and digital credit is already saturated? The answer likely involves leveraging Orda's restaurant management software to create sticky B2B relationships where credit follows software adoption. For Nigerian fintechs eyeing expansion: this validates the "buy a licence" route over organic regulatory applications. For Kenyan incumbents: Moniepoint processes more transactions monthly in Nigeria than most Kenyan fintechs handle annually - underestimating their execution capacity would be a mistake.

What's happening. Nigeria's Central Bank concluded its 24-month banking sector recapitalisation programme, with 33 of 37 licensed banks meeting revised minimum capital requirements by the 31 March 2026 deadline. Nigerian banks raised a combined N4.65 trillion in new capital over the period, with 72.55% (N3.37 trillion) sourced from domestic investors and 27.45% from international markets. The programme, launched in March 2024, required commercial banks with international authorisation to hold N500 billion minimum capital, national banks N200 billion, regional banks N50 billion, merchant banks N50 billion, and non-interest banks N20-10 billion depending on licence type. Four banks remain subject to ongoing regulatory and judicial processes.

So what. The 72.55% domestic funding share is the real story - Nigerian institutional investors, high-net-worth individuals, and existing shareholders backed lenders aggressively despite currency volatility, inflation, and economic uncertainty. Someone put that on a billboard. What a time to be Nigerian. That's a major vote of confidence in the banking sector at a time when attracting capital remains central to Nigeria's economic reset. What does this all mean? Nigeria just proved local capital exists at scale when regulatory frameworks are clear and compliance timelines are reasonable. The 24-month window with multiple capital-raising pathways prevented the fire-sale dynamics of 2005. For banks that met requirements: you're now positioned as consolidators, acquiring or merging with the four that didn't make the cut. And the big takeaway is this, stronger balance sheets don't automatically translate to real sector lending - the challenge shifts from capitalisation to credit deployment in an economy where government securities still offer risk-free returns above most corporate lending rates. Nigeria, our eyes are on you.

Old Mutual buybacks exceed R2bn. Old Mutual's share buyback programme has now exceeded R2 billion as the insurer returns capital to shareholders following strong earnings and improved capital ratios.

SA insurers surpass R5trn assets. South African insurers surpassed the R5 trillion assets milestone, reflecting strong investment performance and premium growth across life and short-term insurance sectors.

Nium launches stablecoin card platform. Nium introduced dual-network stablecoin card issuance enabling companies to issue spending cards on Visa and Mastercard through single API - stablecoins spendable at hundreds of millions of merchant locations globally via crypto-to-fiat conversion at point of sale.

Wise launches UK current account. Wise rolled out UK Current Account with 3.26% variable rate on GBP balances, Airport Lounge Pass, and Young Explorer cards for under-18s - challenging Revolut and Monzo with £8bn already held by 3 million UK customers.

Swift blockchain ledger goes live 2026. Swift completed design phase of blockchain-based shared ledger and is building MVP for real transactions this year - enables 24/7 cross-border payments using tokenised deposits via Ethereum-compatible architecture with 40+ banks involved.

Visa and Ramp deploy agentic AI for bill pay. Visa partnered with Ramp to use agentic AI automating corporate bill payment workflows - AI agents handle invoice processing, approvals, and payment execution without human intervention.

Visa unveils AI dispute resolution tools. Visa launched AI-powered dispute resolution platform automating chargeback analysis, evidence gathering, and case management -reducing resolution times from weeks to hours for merchant and issuer disputes. Though some are less than enthusiastic about it.

Mastercard completes agentic AI transaction. Mastercard executed first agentic AI-driven transaction in Hong Kong - autonomous AI agents (AI bots) negotiated payment terms, verified credentials, and completed settlement without human oversight, demonstrating autonomous commerce capabilities. The risk here is safety.

Australia caps interchange fees. Reserve Bank of Australia introduced caps on interchange fees for card payments - limiting merchant service charges and reducing cost of card acceptance for Australian businesses amid regulatory push for payment affordability.

Revolut hits $2.2bn profit. UK neobank Revolut posted record $2.2 billion profit in 2025 as subscriptions surged, cementing position as Europe's most profitable fintech challenger bank.

Brain Teaser Answer: B) 5.6%

1.8 million ÷ 32 million = 0.05625, or 5.625%. So Pepkor needs roughly 1 in 18 customers who touch its ecosystem to make plusb their primary bank. That's remarkably conservative considering the company owns the physical footprint, has decades of customer data, and already offers credit to this segment. Either Pepkor is sandbagging projections or it recognises most interactions will be transactional (cash withdrawals, bill payments) rather than full primacy (salary deposits, savings, primary spending account). For context: Capitec took 20 years to reach ~21 million customers. Pepkor's setting a 5-year target of 1.8 million from a base of 32 million touchpoints. Of course, the conversion rate matters more than the absolute number - if they hit 10% conversion instead of 5.6%, they'd double their target without changing distribution strategy. Looks like distribution is still a strong moat.