SA Taxi Teases the Idea of Creating a Minibus Taxi Bank


Transaction Capital, the owners of SA Taxi, on Tuesday gave us an idea about how the JSE-listed group wants to bring banking to the minibus taxi industry.

SA Taxi is vertically integrated minibus taxi platform using specialist capabilities, enriched proprietary data and technology to provide developmental finance, insurance and other services to empower small- and medium-sized minibus taxi operators.

SA Taxi will continue to assess opportunities for further vertical integration, to broaden its addressable market and support future organic growth, Transaction Capital informed investors on Tuesday.

“An important growth initiative will be to establish a business that combines its telematics capabilities, rewards programmes, client data and finance offerings into a single transactional account relevant to South Africa’s minibus taxi industry,” the JSE-listed company explained.


“With SANTACO as a strategic partner, SA Taxi will leverage its unique position in the market to drive growth over the medium term, to the benefit of minibus taxi operators and the broader minibus taxi industry.”

The South African National Taxi Council (SANTACO) owns 25% of SA Taxi.

Also read: Mbalula Wants SA to Create a Co-Operative Bank Owned by Taxi Operators

SA Taxi well-positioned to create a bank

Rewards Programme

The company already runs a successful rewards programme. SA Taxi Rewards, a minibus taxi rewards programme, is slowly being embraced by South African taxi drivers as it continues to evolve in ways aimed at further benefitting the industry.

The rewards programme was launched in April 2018 by SA Taxi, an independent minibus taxi financier, in collaboration with Taxi Choice, the commercial arm of SANTACO. SA Taxi Rewards programme was previously known as Black Elite.

SA Taxi Finance

The company also operates SA Taxi Finance.

SA Taxi’s gross loans and advances book grew 14% to R12.2 billion, comprising 32 890 loans.

“The retention of market share and higher retail prices for new vehicles supported this growth. It is important to note that in normal conditions, book growth is a function of loans originated and vehicle price increases, less attrition,” said Transaction Capital.

SA Taxi Protect

SA Taxi’s insurance business is the main contributor to non-interest revenue, with gross written premiums up 10% to R907 million in the year ended September 2020.

“This was a good result given the deferred repayment of insurance premiums in April 2020 under SA Taxi’s COVID-19 relief programme and other disruption,” said Transaction Capital.

“As expected, higher lapse rates were experienced as COVID-19 affected the affordability of insurance cover.

“Despite the extraordinary conditions, SA Taxi Protect’s broader product offering supported high single-digit growth in the number of policies on book. The development of other bespoke products for the industry remains a strategic imperative.”

SA Taxi Direct

SA Taxi’s retail dealerships generated gross revenue of about R600 million in the period, down on the prior year due to the disruption in new and pre-owned vehicle supply and the closure of SA Taxi’s dealerships in April and May 2020. Higher vehicle prices partly offset the decline.

The minibus taxi industry is thought to be a sleeping giant defined as:

  • An R100 billion industry
  • With more than 200 000 vehicles
  • Employing more than 600,000 people
  • Transports 15 million commuters per day
  • Accounting for 66% of the country’s public transport traffic
  • Fuel spend by taxi industry per year is R30 billion
  • R1 billion VAT Contribution on vehicle sales per year
  • R4 billion contributions per year to the Road Accident Fund

With a united vision, the industry could launch a mutual bank at the blink of an eye.

Off course, that is easier said than done. The industry is dogged by violent fights for markets and control of its massive levy kitties. And it is disorganised and unprofessionally run.




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