Updated 22.03.2022

Capitec Business Loans

Capitec Bank was founded on 1 March 2001. It currently has 852 branches in South Africa serving about 14.7 million active clients. Following its acquisition of Mercantile Bank in late 2019, Capitec Bank now offers business loans through its new subsidiary. Mercantile Bank business loans have competitive rates and are specific to your business needs. They include:

capitec business loan
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  • Asset Finance loan
  • Overdraft loan
  • Business Credit Card loan

Asset Finance

Through Mercantile Bank, Capitec gives loans to your business for financing motor vehicles, property or equipment.

Types of Asset Finance Loans

Capitec Bank only lets businesses that need money for specific assets to be approved for an Asset Finance loan. For these reason, they have the following options availed to businesses:

Instalment Finance

An Installment Finance option is for businesses that need loans to pay for supplies. As a precondition, the supplies have to be durable and movable. There are two perks your business gets from this Capitec Bank loan option:

  • The business gets access to the prime lending rates for a fixed period.
  • It also gets competitive rates for product insurance from Capitec Bank’s partners.

Vehicle Finance

Vehicle Finance option with Capitec Bank is a loan offered to businesses that want to purchase motor vehicles. They allow purchases from private sellers or from dealerships. This option, like Installment Finance, also comes with the two advantages. Your business gets access to the prime lending rates for a fixed term and competitive rates for motor vehicle insurance from Capitec Bank’s partners.

Rental Finance

Capitec will grant loans to your business for office equipment like   telecommunications, those for office automation systems, for security surveillance, for medical aid, or computing systems and any other related equipment through this option.

A loan under this option takes the form of a rental asset agreement. Its term is anywhere from 24 months up to 60 months. The advantages of this loan include:

  • Favorable finance terms
  • Flexible repayment terms.
  • Allowance for the loan to be an off-balance sheet finance. For which reason, your business will enjoy tax benefits and reduced debt exposure.
  • A fast approval process which does not require a deposit.

Business and Commercial Property Finance

Business and Commercial Property Finance option with Capitec Bank lets businesses get the following:

  • Favorable finance terms
  • Flexible repayment terms.
  • Access to the prime lending rates for a fixed period. The Loan to Value (LTV) for the loan with an interest rate linked to prime lending rates is 70%. Additionally, the business is required to pay a deposit of 30%.

Cash POS Finance

A Point of Sale Loan is usually one in which deductions for loan repayments are made at the time and place in which payments come in for sales made by the business.  Cash POS Finance option with Capitec Bank has the following features:

  • It is determined by the sales volume or turnover of your business as exhibited by your merchant account in a 12 month period. This means your business’ merchant account must have a 12 month track record to qualify for the loan. Additionally, the business must have been in operation for at least 24 months.
  • It lets your business take out a maximum amount of 10% of your turnover or, if lesser, R500,000.
  • It has an arrangement in which the repayment is deducted at the Point of Sale (POS) as 10% of your businesses daily sales.

Asset Franchise Finance

Capitec Bank’s Asset Franchise Finance Loan is tailor made for businesses that own, want to purchase, or are part of franchises. The loan is given for:

  • Purchase of franchise business.
  • Purchase or value addition of capital goods.
  • Overdraft purchases and payments by a franchise.
  • Purchase of franchise property through commercial property loans.
  • Renting of a franchise location.
  • Purchase of movable assets like motor vehicles.

Overdraft

Capitec’s Overdraft Loan lets your business make payments or purchases on overdraft when the business bank account balance runs out. The loan:

  • Is a revolving facility type loan.
  • Has an interest rate linked to the prime lending rates.
  • Term only makes your business pay for the amount used in overdraft and not the full loan available to it.

Business Credit Card

Capitec business credit cards are provided by Mercantile Bank. They are all Gold Credit Cards. A Gold Credit Card comes with the following advantages:

  •  Automatic enrollment into a loyalty program that gives the card holder access to premier Bidvest lounges at Airports across the country.
  • An option to nominate business associates and employees to share one card account. The bank tracks the credit card users and sets their credit card loan limits individually.

Rates and Charges

The charges for Business loans  from Mercantile Bank are:

  • A monthly overdraft fee of R69 on a current account.
  • A monthly credit card account fee of R40.
  • Business Gold Credit Card initiation fee of R250.
  • A monthly primary credit card fee of R40.
  • A monthly secondary credit card fee of R40

The interest rates are:

  • 4.25% for a term of 32 days, and
  • 5.5% for a term lasting 367 days.

According to Mercantile Bank, these loan rates are subject to the following notes:

  • The published rates are effective from 28 January 2022.
  • Rates are subject to confirmation on receipt of funds or the renewal of the investment by Mercantile.
  • Rates are reviewed from time to time and are subject to change.
  • All rates quoted are nominal rates, unless indicated as effective rates.

Conclusion

Capitec Bank offers competitive interest rates and useful loans to businesses through it’s subsidiary Mercantile Bank. As the manager of a business, you can take advantage of these loans to grow and expand your business. The loans can help with purchase or rent of equipment, assets, supplies, or even premises. They can also help with emergency situations like when the business bank account dries out unexpectedly. They offer overdraft services for businesses to help when this happens. This article gives you a scope of what the loans are for and what they will cost your business. All the loans are applied for through the official website for Mercantile Bank.

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