Capitec Bank, South Africa's largest commercial bank by customer base, has taken a significant step to attract and retain top talent in the competitive financial sector. The bank has increased salaries across its workforce, with a notable shift in employee pay scales over the past three years. According to its 2024 remuneration report, the number of employees earning between R250,000 ($13,268) and R500,000 ($26,536) annually has tripled, now accounting for 62% of the workforce.

This move mirrors broader efforts by South African banks to retain skilled staff. Absa and Standard Bank have also increased their minimum salaries for 2025, with Absa raising its minimum pay to R250,000 ($13,268) annually, an 8.7% increase from last year, and Standard Bank increasing its minimum salary to R258,390 ($13,731) per year, with unionized employees receiving an average 5.8% salary boost.

The shift in salaries is also a response to macroeconomic trends. According to payroll consultancy Axiomatic, salaries in South Africa are expected to rise by 5.5% in 2025, slightly above inflation. The share of employees earning between R180,000 ($9,550) and R250,000 ($13,268) has fallen sharply, from 61% in 2021 to just 16%, while those earning under R180,000 ($9,550) now make up only 2%, mostly interns and entry-level hires.

Capitec Bank's remuneration committee chair, Vusi Mahlangu, emphasized the importance of fairness in the bank's pay structure, particularly for executives and higher earners. "Fairness is reflected in the way that we structure pay for executives and higher earners. At this level, we manage fairness by a higher weighting of pay towards variable pay," Mahlangu said.

The bank has also invested heavily in its tech talent base, increasing its IT salary budget by 28% to R1.7 million (about $90,200). This has helped boost the proportion of staff earning between R500,000 ($26,536) and R1.5 million (about $79,600) from 11% in 2021 to 17% in 2024. Furthermore, 10% of Capitec employees now earn over R1 million (over $53,000) annually.

Capitec's strong financial performance has driven the salary raises. Net profit rose 30% to R13.7 billion (over $728 million) in 2024, driven by expansion into new segments like business banking, insurance, and digital financial services. The bank has also attracted a more affluent customer base, with a 27% increase in clients earning R50,000 (about $2,650) monthly.

The salary raises come as the bank undergoes a leadership change. Chief executive Gerrie Fourie, who has led Capitec for 25 years, is stepping down. He earned R104.8 million (over $5.5 million) last year, including R75 million (over $3.9 million) in long-term incentives, and holds one million Capitec shares valued at roughly R3.3 billion (over $175 million). Though retiring as CEO, he will continue to advise the bank on its international expansion plans.

In conclusion, Capitec Bank's decision to increase salaries across its workforce is a strategic move to attract and retain top talent in a competitive market. As the bank continues to expand its services and customer base, it is essential to invest in its employees to sustain its high-performance culture and drive future growth.