JOHANNESBURG, Sept 19 (Askume) – South African financial services group Discovery Ltd (DSYJ.J) expects its digital banking business to remain loss-making in 2025 and reach a target of 1 million customers ahead of schedule after cutting losses last year, CEO Adrian Gore said on Thursday.
Discovery announced its annual results on Thursday, saying the digital bank it launched in 2021 reduced losses by 41% to R454 million and said customer growth had driven revenue growth.
Gore told Askume he expects the bank to become profitable next year with an annual operating profit of R400 million, and is targeting an operating profit of R3 billion by 2029.
The bank, which mainly serves wealthy people aged 25 to 50, said its total customer base grew 36% this year, far exceeding its target of 1 million users in 2026.
“Unless you have a repeatable, scalable model, you can’t grow organically, so our approach is really to grow organically rather than through acquisitions,” Gore said.
Discovery Bank specialises in personal banking, expanding its product range with the launch of a revolving credit facility in December 2023 and home loans in May 2024. Both received a “pleasant initial response”, the company said.
The digital bank’s competitors include (OMUJ.J) Old Mutual Bank (CPIJ.J), Capitec Bank (SBKJ.J), First National Bank, Standard Bank (FSRJ.J), Firstrands (ABGJ.J) Absa Bank.
The group reported that overall normalised core revenue rose to R7.3 billion ($418 million) in the year to June 30, a figure Discovery believes is a more accurate measure of its profit and excludes non-recurring items, compared with its record of R6.4 billion a year earlier.
Discovery declared a final dividend of 152 cents per share.
(1 USD = 17.4051 Rand)
