UPDATE: Capitec backs Home Affairs' ID fee hike, absorbs costs to shield clients amid TymeBank clash

Key topics:TymeBank warns R10 fee risks excluding the poorest clients.Schreiber defends hike, citing fraud prevention and digital reform.Capitec supports upgrade, says secure ID system is essential..Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa’s bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here.The auditorium doors will open for BNIC#2 on 10 September 2025 in Hermanus. For more information and tickets, click here..By Kerry Lanaghan.Listen to this story instead:.According to a report by MoneyWeb, Tyme Group CEO Coenraad Jonker has urgently called on the Department of Home Affairs to halt a planned 6,500% increase in identity verification fees. While Home Affairs argues that the hike is necessary to fund essential system upgrades, citing frequent downtime in the current system, Tyme warns the move will disproportionately harm South Africa’s poorest citizens.Jonker cautions that this abrupt price hike, which increases ID verification fees from 15 cents to R10 per lookup, will either force banks to raise costs for low-income clients or absorb the expense themselves, ultimately threatening their ability to continue serving the country’s most vulnerable communities. He describes the increase as a regressive tax and warns that South Africa’s leadership in financial inclusion risks being reversed.According to News24, Home Affairs Minister Leon Schreiber has fired back, accusing Jonker of a “state capture instinct” that prioritises private profit over the public good. In his view, the fintech sector’s resistance to the hike reflects a reluctance to contribute to national infrastructure. Schreiber argues that upgrading Home Affairs’ crumbling systems is critical for fighting fraud, ensuring compliance, and modernising governance - and that the private sector must play its part.The standoff has ignited a broader national debate about how best to balance digital progress, accessibility, and financial sustainability. Jonker maintains that while TymeBank supports improving government systems, the increases should be implemented gradually, with volume-based discounts for institutions that process high queries. He also insists that the R10 fee is inconsistent with international best practice, making South Africa more expensive than any peer nation.But support for Schreiber is growing. According to TechCentral, Capitec Bank has publicly sided with the minister, stating its full support for upgrading the National Population Register and reinforcing the importance of a “secure and stable national identity system.” In a statement, Capitec said the system is “a critical building block to prevent fraud, which ultimately comes at a significantly higher cost to all South Africans.”While Capitec acknowledged that the fee hike would raise its costs, it announced that it would absorb the increase, at least for the current financial year, so clients would not see any rise in banking fees for now. The bank described the initiative as essential for safeguarding the integrity of South Africa’s digital economy and added that it remains committed to working with the government to advance secure digital banking and protect customers from fraud.This growing divergence in the banking sector underscores the tension between financial inclusion and national reform. On one side, TymeBank warns that poor South Africans may lose access to no-fee banking as costs become prohibitive. On the other hand, Capitec and Schreiber frame the fee hike as an unavoidable investment in the country’s future resilience.With the changes set to take effect on 1 July, time is running out to reach consensus. Tyme has called for open engagement with the department, transparency on spending the new funds, and a phased rollout that protects the underbanked.The broader implications stretch beyond Tyme and Home Affairs. This episode has become a flashpoint in debates around corporate accountability, governance reform, and the future of digital access in South Africa. The ultimate question is not whether to upgrade, but how to ensure that those upgrades don't leave the poorest South Africans behind.

UPDATE: Capitec backs Home Affairs' ID fee hike, absorbs costs to shield clients amid TymeBank clash

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