Good morning, ladies and gentlemen. Yeah, it's a great privilege to present our annual results. I think everyone knows by now the SENS went out this morning that we increased our earnings per share by 30%. I think it's an incredible performance given the economy and where the world is. I think what is also very important is if I look at the SENS went out 7:00 A.M. this morning, integrated report went out, the CFO report went out, and I'm presenting this morning, so I think just the fact that we're bringing our results out within a month and a half after year end, let's give our finance team a big -
I think if you look at our results, I think you need to go back and look at the last five years actually basically where COVID started and I think if I sum it up as that whole sentence there turning challenges into opportunities, looking at things differently. Be innovative, differentiate and really add value to your clients to make certain that we can produce what was the challenges. It's actually quite incredible if you think through it. COVID, we all have forgotten about COVID. It was actually quite nice driving here this morning and the parking is full. Everyone is here. That's quite, quite nice. Global economy, we know what happened with Ukraine, Russia, world recession basically happening. I think I don't need to say much more about what's happening lately with Trump making a couple of statements.
The whole effect of that is high inflation and high interest rates. It is a difficult environment to operate because of that. That old saying that if America gets a cold, if America sneezes, we will get a cold. We had to operate in that particular environment. What was our response? What did we do? I think our focus is client obsessed and that is the Capitec DNA to really make certain that we understand our clients and we deliver on our clients. I remember in COVID I still said about mid- July, I said now we are going to make certain that we are digital and we really make certain the client can sit at home and he can really do his banking from home. Our credit management over this period was challenging.
We unsecured lending and we really need to think out of the box and to make certain that we go through COVID and then to go through Ukraine, Russia, and actually where we are now, we've diversified the company. If you look at the last six, seven years, we were actually purely a retail company. Retail banking, that's all we were. Now we business banking and now we've got VAS, we've got Connect, we've got business banking. The business has changed completely in a matter of five, six years. For me the one that I think people underestimate is our ability to innovate and scale. We are low margin, high volume business so we're giving back to our client and we can really scale on a big scale.
Yet if I look at our growth opportunities and I'm purely looking South Africa, interesting, 50% of our adult population, South Africa, 66 million people. So it's 33 million people. It's between the age of 16 and 35. So what is the trick? How do you bring those people in and how do you make certain that they sticky and they're part of the Capitec family, our SMEs, and I've called that now small, medium and emerging markets, township market. There's about 3 million spaza shops out there. 70% of them are in the informal market. How do we capture that market? And we actually unlock the potential in South Africa.
What I've seen in the last year with the whole Government of National Unity is really if you can get the private sector and government to work together to have clear growth objectives, we can really unlock the potential in South Africa going forward. We are purposely business. I think if I look at ourselves versus anyone else is I had a long discussion on Sunday with somebody on business and I just emphasized the importance of the why. If every single person, 17,000 of our people, understand the why, they can produce. Our why is very clear. We want to make a meaningful difference in people's lives. Emphasis on meaningful because if you really want to do something meaningful, you need to do it differently. You need to add value and empower them to grow.
That's our whole mission, that's where we're going, that's what we're focusing on. If I look at our fundamentals, it hasn't changed. I remember 2000 when I joined, we debated for six months these fundamentals. It's still exactly the same fundamental fundamentals. Everything we do is about simplicity, affordability, accessibility, and personal service. That personal service has just moved from branch to app. Again, that personal extra step that we need to take through what have we done, our solutions? I think we've diversified, I'm not going to elaborate on that, but I think we've really taken the bank and we've created a financial services company. The one that I'm extremely proud about is what our IT people have done by really going and saying how do we use best of class. How do you use Salesforce? How do you use SAP?
How do you use AWS? To really enable our own people to really only focus on our product development and then everything putting it on the cloud. All our data is in the cloud so we can optimize and we can really create value to ourselves. That is the triangle. I think that is the most important part of what we are doing in Capitec. I think the other very reason for our success, basically three words: CEO culture. I will impact the CEO culture. I think every one of us know the CEO culture are clear objectives, very clear one-page objectives, very clear, very precise. Then discipline execution. It is quite easy to talk about a strategy, but if you do not execute it, you know where you need to deliver on that execution of that particular strategy.
I think everyone knows the CEO. It started in 2014 where we said I do not want to be the only CEO. I want every single person to think like a small business person. The C stands for client, the E for energy, and the O for ownership. If you unpack that, if you look at client obsessed, I think our first thing starts with the trust of our clients is our top priority. What is trust is the ability to deliver on a consistent basis. The same thing over and over and over again. Our yes is our yes and our no is our no. That is when you build trust with your client and client base, client led product development and experience design.
It's all about making certain that we go that extra yard and we make it simplistic and delivering to our clients and in depth knowledge of the business. I've got a saying if you move we measure. We all know our MOS or management operating system. That's our system where we measure, measure ourselves on a weekly basis, monthly basis and quarterly basis to say are we on track? What we've done lately is if I look at our product health, measuring our product health to say is it delivering what it's supposed to be delivering? And CSAT. We're using CSAT now right through to make certain our clients is actually saying to ourselves are we delivering on their needs? Yes or no energy of our people culture.
We all know our culture goes about client, people and delivery because what is culture about that enables a company to become 200, 300 years old because it's in their DNA. Culture for me is a simple thing of saying you don't think you can just make a decision and you know you're taking the right decision in line with what the client needs is we've built a very strong, diverse and future ready leadership team. If I look at our leaders that's sitting here in front of us, young, dynamic, really people that has got the DNA culture in them and can really take the company forward and where we want to go. One that I think people underestimate and I will elaborate on it later is the way we incentivize and provide bonuses.
Your strategic people are looking five, six years ahead and it's compensated on that basis. Everyone is compensated and get a bonus on exactly the same basis. It's not basically this department versus this department versus dysfunction because you start fighting to say, I'm going to miss my target. For us it's Capitec and it's all about Capitec and if Capitec delivers then all of us benefit from that ownership of delivery. Elaborate on the scalability of our technology and our cloud platforms. The interesting stat there is by accident, one day, asked Wim how many engineers we've got because wherever I see I just see we're appointing engineers and it was quite frightening to get a number of 750. We're over 750 engineers making certain that we can deliver on our clients' needs.
We've replatformed our app completely and the main thing of that is to make certain that it's scalable and it's available. Our stability performance is over 99% for the last four months. We were basically, apart from one day this month, we were basically 100% up right through. The most important thing going back again for me is low margin, high volume business model. If I look at our pricing for the last five, six years, especially in our digital space, we haven't increased our pricing at all. Why? Because the ability to scale and to get volume through in our business. I want to share now with you a small video that actually just captured our DNA and what Capitec stands for.
Now if you look at what we've got, what we're working with is I think the first thing is just to look at our client base. It's an incredible number. 24 million. I remember when Riaan said we're going to do 20, our first business plan was 2 and then he made it 5 and then I laughed at him, I made it 15. We are now 24 and I'm 100% certain we will be at 25 by the end of this year. 24 million clients. That's our base that we work with. There are 13 million app clients that are working with the app. There are 11 million VA S clients that are actually doing a transaction on VA S. The most important figure, 8.8 million fully banked. People that are actually depositing their salary with ourselves.
The question is, how do you grow that 1.6 million Connect clients and that figure has climbed very, very nicely. I'm looking there at a 10 million figure in the next two, three years. That's for me a big figure that we need to focus on self. I think if I look at, which is not on here, if I look at our funeral site, 3.3 million policies out there and our credit lines, 1.4 million credit lines and then business banking, 220,000 new business banking. Interesting. If you look at what has happened, we had very strong growth of 26%, 26.5% in people earning 50,000 and higher. We've got 11 million clients. Remember I spoke about the youth clients or people between 16 and 35. We already got 11 million clients or 54% market share.
The trick is to say how do you take those clients and when they're 50, 60 years old, are they actually still banking with ourselves? If you look at our results, and I think this slide sums up for me the whole basically our financial performance up, our headline earnings up 30%, which I think is extraordinary performance if I look at what has driven it, our net interest income after impairments. We've gone through difficult periods, we've opened up our credit side, we've got our impairments in control and the result of that is a 54% growth or basically close to ZAR 3 billion growth in our net interest after impairments. The important one is what is our business looking like? Five, six, seven years ago we were basically 100% credit. Now only 33% of our income is coming from credit, 67% is coming from other income.
It's either our insurance business, it's either VA S, it's either the transactional side. 67% of our income is coming now from other sources. Interesting. That figure was 72% last year. You can see what has happened. Credit has performed better and so the credit has taken up. I'm quite relaxed. If we can keep it to about a 70% then ROE. The question I'm always going to get is where's our ROEs? I've given up on the 25%. I think we're more now at 29, 28.8% ROE. Just maybe to explain it, the secured side, we're pricing at 15%, our unsecured at 25%. You're sitting at transactional side that's really kicking at a much higher rate. You get those economics of scale.
Because of the ROE of 29%, we've increased our dividend payout from 50% to 55%, which I think is giving back to our shareholders, which is a great achievement. Our credit loss ratio 7.5%. Personal banking at 8.1 and 1.7 for business banking, a very strong performance on that side. Our transactional side up 17%. It is ZAR 14 billion that's coming out of our transactional side. Our VA S and Connect ZAR 4.4 billion at 61%. Funeral, Funeral and Life up ZAR 600 million or to ZAR 1.9 billion. Our operating expenses is up 30%. If you take out AvaFin and if you take out the incentives, and I'll elaborate on that later on, we've got a 14% growth in our OPEX coming through. That sums it up for me. It gives me a very good. I think if you look at this, a very, very strong result.
If I look at our income statement, and this is excluding AvaFin, we've grown, excluding AvaFin, 28%. You can see that big kicker on the credit impairment charge, we're down 15%. We have dropped from ZAR 8.7 billion to ZAR 7.4 billion. You can see our net interest up 39%. Our transactional side up 25%, i nsurance 19%. Our OpEx, just for the analyst, if you look at your tax, since we've got our own insurance license now, that is getting taxed at the bottom, not at the top anymore. There is a distortion in our tax, but it's normal 27% tax rate. We have added AvaFin coming in and that gives us the 30%. What you're seeing there is ZAR 13.7 billion, about ZAR 200 million that AvaFin has added to our income for the year.
This is interesting just to say where's our income coming from? You've got strategic initiatives coming in with 23%. You've got insurance 25%, business banking 5%, and then AvaFin 2%. You've got personal banking 45%. I think the important thing about personal banking is they got the 24 million clients and they've got the 880 branches. If you look at strategic initiative and insurance, they don't need to worry about clients, they don't need to worry about distribution because it's in. That gives us that platform to really grow. I think it's interesting to just see where our income distribution is coming from. Personal banking, this is interesting. We've taken our 24 million clients and say how they're spending their money. This is for a year. It's the average spend for a year. Interesting.
Food, we all know food inflation was extremely high. That was 9% up. Strong growth on that. I think a big portion of that is inflation driven. Fuel is 3%. I think what this takes out is what people do on cash. We know the taxi industry is cash. That is not in here because we can't track the cash component. If you look at it, restaurants up 10%. For me, the interesting one to see is unfortunately alcohol has gone up. That was worrying, but that's probably life. Electricity, you can see electricity going 18%. That is Eskom. Interesting on cell phones, the people are spending more on cell phones than they're spending on electricity. It just shows you how important the cell phone is, airtime, etc for the particular clients. If you look at personal banking and you say where's.
Now getting back to personal banking, where's the income coming from? You can see there net lending and investment income after credit impairments up from ZAR 7.7 billion to ZAR 10.4 billion. It is a ZAR 2.7 billion improvement on our credit income coming through. Our transactional side, peer transactional side. It's interesting, it's ZAR 12.8 billion versus ZAR 11 billion. That is bigger than credit, just the transactional side on its own. We add value-added services and Connect to ZAR 4.4 billion and then insurance to ZAR 3.8 billion. That gives you a different perspective of our income distribution in our personal retail space. If I look at credit, what have we done in credit? That dotted line was Ukraine and Russia. We were brave.
After we thought COVID was finished, we opened up and then suddenly we realized there's a bit of a commerce, so we had to pull back. That dark blue line you can see was 2024. We were selling below 2023 and 2024. This year came and you can see for the first five, six months until about August, we were actually below the dotted line. We have opened up slightly to get to highs with a peak of ZAR 5.4 billion in December. What is important is the bars at the bottom show the number of applications and what we've seen is with AWS we can offer better, better and quicker value to our clients. We can tell the clients you qualify for XYZ and that enables clients to come in much quicker.
You can see the number of applications has actually gone up. It's not so much that we've opened up the credit side but we've actually worked on client based business better and actually offering that value to a particular client. You can see March was 280,000 clients and a number of new applications to 510,000 in December. It's interesting to see it at that growth. I just want to quickly go back. What is interesting is with our credit card and with access facility, 54% of our credit income is actually annuity income. What we mean by that is if you've got a credit card, you buy, you pay it back hopefully and then you can, then you can buy again. It's annuity income. If you can look at our credit card, a lot of focus on our credit card.
We've increased our market share quite a lot on the credit card space. Sales are up 48% to ZAR 5 billion. You can see that annuity income that's coming through from ZAR 17 billion- ZAR 21 billion. It's actually that ZAR 5 billion that you just added, which is on annuity income for the future. That shows you've got very strong growth on your credit side. I think I want to focus on, we've changed our credit side to look at different areas. This is for me the most encouraging if I look at our clients that earn on a net basis more than ZAR 50,000 a month. We've increased sales with 56%, offering different credit via different channels, diversifying our credit offering, and it's gone up from ZAR 8 billion to ZAR 10 billion. Very strong growth in our below ZAR 50,000 net income client base.
The one that excites me a lot is our purpose lending. Remember what we do is on purpose lending. We price at about 4%-5% lower than the normal pricing because it goes to a third party. We pay a third party directly. We've been working very hard this year. We've done last year you can see ZAR 435 million of which home improvements was ZAR 171 million and cost was ZAR 235 million. What have we done in this year? We've added another 100 vehicle dealers. We've put in 800 building supply locations. We have Cashbuild and Build it in it and then smartphone that we've added. You can see the sales that's coming through there of ZAR 1.8 billion. I really believe our purpose because that's really adding value in a client's, it's helping him to grow and to develop the same.
This figure will change quite a lot going forward. On the app you can now do your loan directly on the app because we can score you automatically. We can use AWS to score you. Close to ZAR 900 million sales have gone through our app for the first time. That figure will also change because the person now can sit at home and press two or three buttons and he can get his credit directly. There's a story on the credit loss ratio. You can see the high of August 23rd. That was Ukraine, Russia, 11%. We've always through the cycle been at 8.5%. We came in at 8.11% in line with our expectations. Very strong performance on the credit side. What have we innovated going forward?
We're busy getting approval from the Reserve Bank on working with SA Home Loans , SPV with SA Home Loans of ZAR 5 billion because they haven't got the strong enough balance sheet to fund our clients. Our book there is about ZAR 3 billion where we will do the funding but we'll use their credit models and our credit models to optimize and really go into the mortgage market much stronger. That's quite exciting. On our credit card, if you've got a Capitec Connect SIM you get 1 GB of data free. If you've got a Capitec credit card and then we launch a new credit card because we've seen a lot of people have got thin files or haven't got credit records and how do you build that credit record? We're providing people with a ZAR 600 credit card payable over three months.
Over time you take that ZAR 600 to ZAR 800, ZAR 900, ZAR 1,000 and build up a credit history for the client base. The one that excites me the most is the so-called dynamic loan or the loan for our merchants, our sole props for the emerging markets as well as people with multiple incomes. What we're doing here is we agree with the client that all your inflows we will deduct 5% or 10%, so you'll get a loan of X and then on each inflow we will deduct, even if it's cash, EFT, or coming via the card, we will deduct whatever we've agreed with that particular client and he repays his loan as his business is performing.
I think that's going to be a game changer because your problem is always he never kept all his money till the end of the month and then he can't repay. Now he's repaying as what he's getting his inflow that's coming into his account. Transactional income. We've always said, or I've always said we hate cash. How do we get our cash away? It's interesting if you look at our ATMs and we always got that question about our queues at our ATMs, but we've got close to 9,000 ATMs, by far the biggest in the market. Our competitors are here around about 4,000. It's actually how do you change the behavior of the client? What we've seen here in this graph, very strong changes are taking place. I'll elaborate on the next slide, but you can see card got up 18% to 2.3 million.
You can see on payments, on digital payments, EFT payments also up 24%. With Capitec Pay playing an important role in changing that behavior of our client base. This is where our consulting, where we can really see that we've changed the behavior of the client. Forget about all the growth in particular areas. If you look to the right, you will see that our number of transacting card clients has gone up from 13.8 million to 16.9 million clients. 17 million clients have made use of a card in the last year of the 24 million. You can see a big adoption on the card side.
Just to elaborate again why it's for us as important, you withdraw ZAR 1,000 in cash. I don't know how you spend it but if you swipe for ZAR 1,000 a couple of swipes, we understand your behavior and we understand where you're using it. We can use it in your credit scoring. You see , card not present, it's 5 million clients, so it's up 56%. The pay wallets, Apple Pay, Samsung Pay, Garmin Pay, etc., million clients using it, up a thousand. That gives you an indication you can look at the values that's been spent. Card payments, ZAR 504 billion. E-commerce very strong, close to ZAR 100 billion. Pay wallets, ZAR 34 billion. Pay Shap and Pay to C ell, very strong performance on Pay Shap. We control about 50% of the market on Pay Shap.
I think the other thing is, and this sums up our DNA, to look at the whole time challenging yourself and to say how do we make things more simplistic? How do we make it transparent? I think we became too complex by having 30 price points, and I challenged the team this year to say how do we make it more simplistic? That is the Capitec pricing. Your business banking is ZAR 50, your retail bank is ZAR 8, and that ZAR 8 includes the VAT adjustment on the 1st of May, but then your pricing is very simple. ZAR 1 Capitec to Capitec, ZAR 2 Capitec to other banks, ZAR 3 for debit order, RTC is ZAR 6, and ZAR 10 for cash withdrawal.
I really, I think this is the most simplistic that you can actually make transactional side and that is for to enable that the client really understand what he's spending on. I really think this is a strong point and the fact that business bank and retail bank has got exactly the same pricing just illustrates our whole philosophy of simplicity and transparency. Strategic initiatives VA S, you can see the strong growth there in the prepaid side. We've got a 41% market share in prepaid. It's actually quite scary to think of all prepaid that's been bought, 41% is bought through our app and 27% of electricity is bought through our app.
We're the biggest distributors of airtime, data, and electricity, lotto, 17% digital vehicle licenses that we launched during last year, up 20% or 20% market share, and Showmax that we've launched, over close to close to 500,000 Showmax vouchers that we've sold. You can really see big, strong growth in all areas on the VA S side. Capitec Connect profit of ZAR 193 million, we basically had last year one product, one gig for ZAR 45 non-expiry, and we know it was not strong enough in the market. We need to bring a full market proposition into the market, and you can see what we've done in, we've brought in expiry, non-expiring, expiry, smaller packages, bigger packages, 10 gig, the lowest in the market, and again our pricing is standard, transparent.
There's our pricing. What our competitors are doing is they play every week with some special or something, and if you want to move, they will cut the pricing. For us, what you see is what you get, so we build that trust with our clients to say here's our pricing. This is what we're doing, we're finalizing it. If you use your Capitec number, then we will probably provide you about between 15% and 20% discount on your data just to encourage people to actually use their own Capitec SIMs. I think what you can see is very strong growth. Our client base, six-month active, 1.6 million clients. Data used, petabytes, 13.4. I still struggle to understand petabytes. It's just too big. It's a couple of rugby fields and whatever.
You can just see the size here and I'm really excited at what can happen in this particular space. Insurance, I think if you look at insurance very quickly, if I look at the funeral and life coverage, up 44%. As you all know, we've moved away from Sanlam from the 1st of November, so now we actually own it. A very, very strong performance. I will elaborate on it now a little in the next slide. Credit life only up 1%. The big reason for credit life is that subdued sales that we had. In March, April, May, there was quite a lot of retrenchments in the mining industry that affected your profitability in this particular area. Overall, we're actually quite healthy, especially if you've seen how the credit book is now growing.
I think if I look at our strategic objectives, we've taken over. We've got our own license, we've taken it over from Sanlam. It was one of the biggest data projects in South Africa to bring all that data across of all those policies. Remember we're covering about 14 million lives in South Africa. It is a big number that we're covering. All of that had to be brought over from basically November till about May, June. It is all about optimizing and creating efficiency and making certain that we can handle claims at big scale and we really can scale the business. From there on we're going to really look at our pricing, our functionality of our three products to really say but how can we go into the market now that we actually own the products ourselves?
I think that is going to be quite exciting. I think the one that's interesting, slowly but surely creeping in, is Life Cover. Over 100,000 policies currently on book. We're selling now close to 20,000 a month. I believe there's a lot of value because if you look at below 2 million, there's nobody really going into that particular market and providing value to our clients in the Life Cover space. Business banking, I'm going to start with a small video.
Mama, what can I eat? What's better than having a business idea? People sharing your vision. It's called Delivery Ka Speed.
What's better than people sharing your vision? Seeing your business take off. What's better than seeing your business take off? Paying it forward in your community. What's better than that? Bringing it home. Dreams come true with people who believe in better. Capitec is the business bank for everyone. Capitec.
Yeah, that's one of our clients. I can give you numerous other clients. It's just nice to show what our purpose is and how we want to make a meaningful difference in a small business space. I'm quite excited about it. It's been a four year journey to build the business bank where it is today. I think we've really built scalable channels and maybe just how we're going to service the clients. We've got business bankers in 19 centrums all over South Africa. We've got our relationship with bankers. There's over 200 of them.
Basically focus on that. You've got a banker 24/7. We've integrated with our branches so that our branches also can support. We've changed our transactional fee structure. You've all seen what we've done in that slide. We've changed our forex side. If you want to do a transaction, it's ZAR 175 + 0.06% so very simplistic pricing. On a merchant commission I will elaborate now where we actually are first on market to actually change everything that's happening in a merchant commission space. Scored lending where we say you need to look at. If you look at small businesses, you need to look at their cash flow. They haven't got assets so you need to lend against their cash flow. That's the models that we've actually built.
We've granted just over ZAR 1.2 billion on scored lending and that figure will grow tremendously in the next couple of years. You can see our number of clients close to 220,000 clients and our gross loans up to ZAR 23 billion. Very strong performance. I think the other one, just to put it in context, because the question is why is Capitec Pay now part of business banking? It used to be part of strategic initiatives. The whole reason is we want to build an enterprise payment service for all our enterprise. If you look at it, it consists basically of about three areas.
This is your physical point of sale where the person goes out and he physically swipes. Then it's e-commerce where the merchant is on an e-commerce platform, you buy, and that's basically where we actually are collecting Capitec payment services, where we collect on behalf of a client, we collect via debit orders, et cetera. The whole purpose is to put it under one person because someone is heading that up and it's going to be quite exciting in that particular area. Big focus for us as part of our whole payment strategy, and I think you can also see what's happened there. Capitec payment services up 15%, ZAR 180 million, and then Capitec Pay, a very sterling performance coming through. I think the one that is quite exciting, and I'm going to just go, you go back.
We've really started focusing on merchant solutions about a year, about a year, probably a year ago. The pricing of our devices was basically ZAR 1,499 for the Pro and just over ZAR 2,000 for the Print. We then said but we need to understand the market and what are we going to do with the market is we're going to change from a rental model to a buy model. You outrightly buy. Just to explain, that rental model is roughly about ZAR 500 a month while if you buy you can see within two, three months you rebuy it. We need to break the whole rental model in South Africa.
The second one was to look at commission rates because it's the big secret everyone is you've got a certain commission rate and then opposition come to you and then cut and cut you and then undercuts you and so you carry on and we just said no, we're going to be transparent and we're going to have flat commission rates that under ZAR 50,000 is new. The rest is what we've put into the market. You can see the results because what we've done is we've gone in with the print at ZAR 499 and the pro at ZAR 99. The result of that, we had 28,000 merchants. Now we've got 63,000 merchants that is transacting with ourselves and you can see the daily sales is up 28%, ZAR 176 million per day and you can see the turnover that's gone up tremendously.
What are we doing from first of May? We've gone in with the Print at ZAR 1,399 fixed price, we've gone in with the Pro at ZAR 699, and then for your smaller merchants we brought in a price, a flat fee of 1.85%. Now the Yoco's and Kazang's, etc., etc., are playing in that market, but they are at 2.5%-3%, so we're going at 1.85%. If you do your ZAR 50,000 turnover within three months, we'll move you to the 50 to 40. ZAR 499, okay. This is to support our small business and to make certain that we make it affordable and accessible with that. We are excited about what's coming through in this particular. If you look at the business banking headline earnings, the first question that comes out is, is business bank going backwards?
I need to unpack that for yourself because we do not go backwards. There is a strategy behind it. If you look at headline earnings last year ZAR 486 million, we have taken out Capitec Pay so that you can compare numbers with numbers. We ended this year on ZAR 432 million, so we were about ZAR 60 million lower. Why is that? The reason for that is we have reduced our transactional fees. That is about ZAR 66 million that we have given back to our clients. The reducing commission rates was another ZAR 136 million, and the impact of changing from a rental to a buy model was another ZAR 87 million. What we have given back to our clients is close to ZAR 300 million that we have actually given back to make certain that we are correctly positioned to attack the small business SME market.
You can see if you take that back then we are growing actually with 32%. I think the important point here is we've made a bold stance of giving back close to ZAR 300 million to our client base to position ourselves to really grow the business bank start and that brings me to the next or above the line on business banking as launched this month. I think everyone has seen it. We've started with certain towns that we are going in and really working those particular towns. Like what we've said is now we're ready to grow and really go on with business banking. I think three areas. It's our unique positioning. I think the fact that it doesn't matter if you're small, medium, large, everyone gets exactly the same, exactly the same as what we've done in retail.
All clients are equal and we treat all clients equal. We open a sole prop account digitally within 30 minutes. A company with one or two directors also 30 minutes, and your more complex structures within a day or two, which is unheard of. Our loans, basically your unsecured lending, is available immediately. We pre score you on those particular area, and your bigger transactions are taking up to a week. On the credit side, I have touched pricing and I am not going to go through that. Our really unique service model lies, for me, in your relationship suite where your relationship bankers have got your full client history.
Every single interaction that you had with any one of our bankers has been recorded because I hate it when I have to borrow a phone, a call center and I need to tell my story over and over and over again. Here they can see the full history and they can start where they left off. We've classified our relationship as in three groups. You'll have a small business, medium business, a larger business. We've got specific industries that we're focusing the people on so that there's people that specialize in restaurants, petrol stations, et cetera, et cetera that we actually can give you that personal service. Like I've mentioned, we've got for your bigger transactions ZAR 50 million plus. We've got your bankers with 19 business centers out there. I'm very excited about business banking and where we're going with business banking.
AvaFin, the new kid on the block, I think not much to say. I think I've said it in half year we've bought it. We got 220,000 clients. You can see the contribution of all the different countries. Our first thing is to fund that. That approval has been given by the Reserve Bank. The transaction is taking place next week where we're going to start funding them. They on average funding is about 15%. We're dropping it to about 8%-9% so that will help their profitability but also to reduce prices. Their prices is far too high to look at their credit loss ratios. We've got a credit team that was last two weeks spending time on that to make certain we get that right.
We spending time, our IT people are spending a lot of time on AvaFin, myself, Grant, and Graham is two weeks from now in Mexico looking at the Mexico market, examining the market and look at the opportunities in Mexico. I have always said this is for me a five year plus venture but it is basically Capitec in 2000. How do you take it and provide, reduce prices, increase the lending terms, add banking to it, add fintech to it, and grow it as the capital of the future. Group savings, our deposit balance grew with 13% so it is a strong growth but it is actually on the fixed and notice side that it has grown quite a lot and that was the launch of the 732 day notice deposits.
You can see we've added ZAR 7.3 billion in savings in that particular area or 1.2 million accounts that was opened and that was only basically July so it's a half a year performance. We've also restructured our savings platform and I think it's just important to understand that we've got your main account that we offer you still at 2.2% interest rate. You've got your access and the access is actually you want to, it's a purpose.
You want to save for a holiday or you want to save for TV or car or whatever, you put it in your access account and you can see you can get up to 6.5% interest rate there. Then you've got your seven to 32 days notice and I must say the seven days, I've used it quite a lot, works quite nicely because you can manage your cash flow for a seven day period, put it away, get a high interest rate, and just release it when we need, and then your normal fixed term saving.
I think we've created better value for our clients by offering better rates for people that are really serious about saving and you can see we've paid last year ZAR 9.2 billion in interest to our client base. OpEx, the one that everyone is going to ask about, why we're growing with 30%, you can see salaries up 14%. Now, you didn't get a 14% increase, bad luck, but there's basically 8% increase in headcount and then a 6% increase in salary, so that explains that particular area. Then the salary incentive and basically what's happened, you can see we're paying out ZAR 2.2 billion, ZAR 1.5 billion will be in cash as the bonuses that will be announced. I think that letter goes out quite soon. What is interesting, of that ZAR 1.5 billion, senior management is only getting ZAR 200 million.
1.3 million is going to our people. That really makes the difference in Capitec, so I think that's going to be well deserved. Everyone always asks us what's happening on IT, but you can see a massive spend. We're a tech and data company, and you need to be in the forefront, so we're spending on that side, 28%. You can see it's people and AWS cloud, those types of expenses that are coming through, and then other expenses on 7%. We're quite happy. If you take out the bonuses, the share price moved from plus minus ZAR 2,000 to ZAR 3,000. That affects your options. You can really see our OpEx is 100% in line with our expectations. Social impact, because we always talk about the things, the results and everything, but we don't talk about our social impact.
What are we doing out there? We have affected 21,000 learners whereby we actually taking a school. We work with the headmaster. We're giving the headmaster a mini MBA to make certain he can run his school properly. We take over the maths and science teachers, give them extra classes and then support them to make certain our children is ready. We now have 25 schools. We want to take that up to close to 50 schools. It's an exciting project where we're actually taking and actually making the DNA of the school correct because if you actually take that headmaster, science and maths teacher and make them strong, then that school can stay there for a much longer period. As what you just pump in money. There was 4,000 volunteers yourselves that actually went in offering your particular time.
Remember we give you off three days a year and that you're involved in a community. It's quite nice there. The picture there is from the brain, our IT exec working with children, explaining to them, I hope maths or data. I don't know what Wim is doing there but it's quite interesting. 4,000 volunteers that's actually given their time and actually worked with 27,000 learners. Financial education, 1.6 million lessons that was given on money, on fraud, on budgeting, etc, etc, and then a big investment in enterprise development. ZAR 329 million that we've given in that particular space. On growing our people, what are we doing on that? A project that we started last year to say but oh, we've seen our branches and BSC, there must be tech people in that particular space.
We said let's take 50 people and we bring them across and put them into the tech data space and develop them. It's actually amazing. We've lost two but it's 48 people that we've given a new career and they're coming in slowly through in IT and tech space and we will definitely enhance that number to a much bigger number and enhance them to other functions as well. 63% of our appointments are internal. Very strong drive on the internal side. Our objective is to go to 70% so that we develop our people from inside. 1,100 people that went through SETA training to develop them in banking and then you can see the number on close to 800,000 people that went through our learning and development courses.
You could say you can see a big social impact, big impact on developing our own people, our future. I think if you want to build trust, if you really want to build trust, one of the challenges we've got in South Africa is fraud and security. It's unfortunately life, but it's how do you make certain that you protect our clients? There is a team of over 300 people that's looking at that particular area to make certain that we protect our client base. We've spent a massive amount on machine learning models on preventing fraud. Syndicates using geolocation, we've brought in where we identify beneficiaries that haven't been paid through our whole system. We call it bad bin, where we say to the client, are you sure you want to pay this person? Because out of our 24 million clients, this person has not been paid before.
We've brought in authentication, facial recognition, where you must verify certain payments that you need to make to protect our clients. In-app calling, if you look at that first screenshot there, you can see we are on the call with you because what we're doing with AWS, we can actually see that it's actually one of our agents talking to the clients, giving the client that confidence that he's actually really talking to a Capitec person. A big focus for us is trying to win that service. Just two areas, I think the first one is our branches. We don't normally talk about our branches, but we are continuously looking at how do we improve our SSTs. What we have done to reduce time in branches now is if you come into a branch, you'll do your biometric recognition at the entrance.
The moment you're coming in front of a consultant, that has already been done. You can just then focus on your transactional side. In- app calling, we've just launched that two weeks ago, whereby normally a client had to phone our call center. They paid for it, they haven't got data, they've got bad connections. Now you can actually in- app, you can phone in- app to the call center, we pick up the tab for that. The most important, all those, I nearly said stupid, but yeah stupid security questions that was asked, what is the name of your dog? What car did you buy? All of those questions you've taken away because you now really know who you're talking.
I think that's going to be a big announcement coming through and then product knowledge on service and design using AI. What you realized is if you're sitting with the number of products we've got, it's difficult to remember everything. Now our consultants can actually just go on, click on a button, ask a question and then there's a whole team at the back with machine learning and AI giving the right answer to the person to make certain that we are giving the best service in the country. Big focus on product knowledge and providing service to our client base. I think you've seen this slide before. What is our big focus areas for the next couple of years? Culture, culture, culture. That's our DNA to make certain that we are driving the CEO culture.
For me, if I look at the CEO culture, it's that small business owner that has got that small shop. He doesn't worry about the hours, he doesn't worry about what's happening. He's just focusing on his client. He's got energy, he's got ownership and he does what is important to make his business successful. It's that DNA that we need to have in full bank to drive and make certain that we are successful developing our ecosystem. We've gone quite a long way with developing our ecosystem and that is just to say how do we bring our 24 million clients to our 220 business banking clients and how do we create a completely different rewards scheme for your small businesses with your 24 million clients? That's a big focus for us, for us to.
You'll start seeing later this year some of these coming through payments. It's interesting if you go into our app, currently there's over 11 methods to pay and it's complicated, different fee structures, which is not a good client experience. How do you go in and make it Capitec-like by deciding what is the best for you and what is the cheapest option to help you assist yourself to get that? It all goes about how we are taking cash away and then how we move it to payments, creating value to our particular client. Business banking and insurance, both those businesses I believe have laid their foundations and the walls are starting to go up. It's really how you take it to the next level. I'm excited about both those businesses.
If you start if you're just optimizing on insurance space, just the current three products on pricing and functionality and then look at next year where do you add things for business, banking, etc. Insurance on that space. There is a tremendous roadmap on that particular area and business banking I don't need to talk about but it's really how do we actually unlock the business, the small and emerging businesses in South Africa to really get South Africa to grow. That is our whole passion and I believe that is achievable. Building a single service platform. We've got business banking service system and we've got a retail business banking service system. That's history, that's what we've bought and it's actually how do we actually bring seamlessly together that a business bank and a retail person seamlessly can be served either in a branch or in an app.
He's got a full view of his personal and business banking activities. That is a project for about 18 months that we're focusing on. The most important is how do we really become a data insights company? We've got a full-time team that's looking at that particular area. As you all know, the data is all on the cloud. It's crazy actually how a thing that normally took about three, four, five days we do now in three, four, five minutes. It's just that insights that we've got, how do we make certain that we fully understand our client, given everything that we're busy with, that we can add value to our client base because that's ultimately what we're all about. Long term is how do we become a global brand? This is what we've shared with yourself.
It's not going to change in the next five years. I'm excited about the vision from my side. Thank you very much. I must say if I look at these results, it's the best results I've ever presented, I believe. It's only about one thing, it's the Capitec team that produced those results. Thank you very much. We'll answer questions if there's questions coming through, but they shouldn't because we've done everything so well.
There are quite a few questions. The first two are from Charles Russell from SBG Securities. How keen are you to enter the mobile handset market?
We're busy with that.
Second question, also from Charles. What are your most notable challenges in making inroads into the SME market?
I think your biggest challenge is it's a cash economy. If you look at that cash economy, you're sitting with about 40% illegal or immigrants, so people from Malawi, Zimbabwe, etc., etc., so it's one of the challenges. How do you actually bank them? Because they're forcing you to actually use cash. How do you, because what the person perception is, I've got ZAR 5,000 in for today, I pay my wages and I pay my stock by cash. It doesn't cost me anything. How do you break that mindset? If you're sitting with that shop in a very small radius, it's quite safe. The moment that they're going out much further, that is not so, so as to break that cash mindset. What we're definitely seeing is where we're bringing in the devices.
The turnover of the client is growing and it's growing much quicker. It's like the delivery person that we've shown in the video and the moment they start seeing that, they realize, hey, but I can't only operate in cash at the moment. I'm starting using card. You can see our cash in, let's call it the formal economy, is only 13%. The rest is all electronic. How do you swing that? You know the biggest advantage we've got, we've got about 400-450 branches in that emerging market. It's going to be a focus. It's not going to be overnight, but it's a focus.
We've got three questions from Ross Krige from Investec. First one, how have airtime advances progressed?
Airtime advances, we've launched it on Capitec Connect. We're doing about ZAR 4 billion, 4 million a month and it's growing steadily. Later this year we'll do full airtime advances on other providers as well.
Second question also from Ross on the credit outlook, given the tougher macroeconomic environment, do you expect to pull back on disbursement growth and are you comfortable that credit loss ratios can stay within the 8-8.5% range?
I'll give you that answer. If you can tell me what Trump is going to do, then I'll know what to do. It is really what is the economy going to do? I think if you look at our last 20 years, the way we've managed credit in an agile manner, working it back to 8.5% through the cycle, that's what we do. We continuously look at our credit as we are on high alert to look at industries that have been affected with the tariff side and if we feel uncomfortable, we will pull back. That is why we sit every week in a credit meeting and make decisions. We will manage it the Capitec way.
Last question from Ross on business banking, is the economic value being given back to clients now largely in the FY 2025 base?
Yes. Correct.
It sounds like you're getting married.
Yes. Short, simple answer.
Grant, here's a question for you from Peter [Kronberger ] from [Ion] Group. Is Capitec still planning a FLAC bond issuance? How does current volatility in the debt markets affect your decision on the timing of an issuance?
Under the FLAC regulations, we'll have to issue starting January next year. We obviously have time to see where the market is by that time. At the moment on our estimates, we'll need to issue ZAR 10 billion of which we'll have to issue 60%, so ZAR 6 billion within the first three years. We'll assess what the market is looking like then in terms of determining the timing of those issuances.
Thank you. We have a question from Chris Logan. I think that one is also for you, Grant. Please can you advise the market share of banking for forex transactions and how much future potential we see in this lucrative space?
Look, I don't know the current percentage of the forex business we have, it's relatively small, below 1%. Yeah, we do see it as a big opportunity. Again, if you think about our offering, the simplified pricing making it affordable, easy for clients to understand. If you look at what the offering in the market at the moment is, it's very complex for people to understand what they're paying, what the rates are. With our approach, we really hope we can grow the market share there and become a market share leader in forex payments in South Africa.
Business banking, overall market shares plus minus between 1% and 2% on all our products.
We've got two questions from Harry Botha from Bank of America Corporation. First one, can you comment on Capitec's non-interest revenue growth potential in FY 2026?
Basically what I've said in the presentation, you're sitting with the transactional sub base that's still growing. You're sitting with, and that's how do we get more and more people to transact? You're sitting with Connect, you're sitting with VA S, you're sitting with insurance. It's how those businesses are growing. Some of them is in a more maturing phase, some of them in the beginning phase. I think just you need to evaluate every line by line and look at that and say, okay, what is your assumptions of what the growth potential is? For me, if I look at 24 million clients, 8.5, 8.8 bank with ourselves. How do you get, there's about, from the 24 million, 6 million in SASSA. You're sitting with 14 million clients. A little bit higher, 16 million clients.
How do you get that 8 million to 12 million, 13 million.
Thank you. There are two more questions, but I think you've answered them already in your presentation. No further questions.
Thank you very much.