Discovery Bank has set its sights on entering the business banking space, with a clear focus on serving small-to-medium enterprises (SMEs) as part of its medium- to long-term growth strategy.
The move, described by CEO Hylton Kallner as a “natural next step,” was publicly confirmed during his presentation at the 2025 UBS South Africa Financial Services Conference. It marks the fourth phase in the bank’s roadmap to reach an ambitious R3 billion in annual profit by the end of 2029.
Discovery Bank’s planned move into SME banking builds on its growing retail client base and its extensive ties to South African businesses via the broader Discovery Group. These include employers linked to Discovery Health Medical Scheme, a nationwide network of 45,000 healthcare practices, and a distribution force of over 12,000 financial advisors.
“SMEs and business banking are a natural growth opportunity for the bank,” Kallner said. “We’re already seeing organic use from small business owners and sole proprietors who are using personal accounts for business purposes.”
He added that this behavioural trend signals a market opportunity that Discovery Bank is well-positioned to capture by extending tailored services to this underserved segment.
Kallner stressed that Discovery Bank would approach business banking with the same disciplined strategy it used to build its retail operations, which have grown steadily since launch. The approach will be innovation-led, with an emphasis on quality over speed.
“We’ve been very deliberate in our retail growth, and we’ll bring the same level of focus to business banking,” Kallner said. “We want to be innovation-driven and, hopefully, quite disruptive—but in a responsible way.”
Group CEO Adrian Gore echoed this sentiment in a separate interview with Daily Investor, saying that while business banking represents a future opportunity, the timing will be strategic.
“The bank is fully self-sustaining and doesn’t require more capital unless we decide to expand meaningfully—such as moving into business banking,” Gore explained. “But we don’t see that happening immediately.”
Discovery Bank’s path to R3 billion in annual profit by 2029 relies on four key pillars: client growth, revenue expansion, margin improvement, and finally, business banking.
The bank is currently acquiring around 1,000 new clients per day and continues to roll out new products, including a successful home loan offering. Notably, over 80% of home loan clients have switched from other financial institutions, and about 60% of Discovery Bank clients are entirely new to the Discovery ecosystem.
Kallner said the bank aims to grow operating profit by approximately R400 million annually to meet its 2029 target. However, he reaffirmed that the bank will not chase growth at the expense of quality.
“We’ve always said we’d rather grow a bit slower if it means maintaining the high quality of our client base,” he said.
A major advantage for Discovery Bank lies in its ability to cross-sell insurance and other group offerings via its digital platform. The bank is increasingly becoming the central point through which Discovery’s South African clients interact with the broader group.
According to Kallner, the banking platform is Discovery’s most secure and most frequently used channel, offering deep insights into client behaviour through daily transactional activity and the Discovery Miles ecosystem.
This integrated strategy helps the bank retain and grow its affluent customer base while simultaneously introducing group-wide products to new clients.
Despite its growth ambitions, Discovery Bank remains selective about its product expansion. Kallner confirmed the bank has no intention of entering the vehicle and asset finance sector, citing limited ability to offer differentiated value in that space.
Instead, the bank will continue to focus on areas where it believes it can innovate meaningfully and leverage synergies with other parts of the Discovery Group.
While the timeline for launching SME-focused business banking services remains undefined, the intention is clear. Discovery Bank is laying the groundwork now for what could become a significant new revenue stream in the coming years.
As it continues to attract high-value clients, deepen its digital infrastructure, and expand its product suite, the bank appears confident in its ability to scale sustainably.
“Our intention is to grow with quality and innovation at the core,” said Kallner. “We believe that’s what will differentiate us in a highly competitive market.”
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