Banks continued with fierce competition in the market of personal transaction accounts in 2019. This is according to the tenth annual edition of the Bank Charges Report issued by Solidarity today.
“Banks attempted to be winners in the market with a combination of better benefits and reduced bank charges,” explained Monica Mynhardt, Researcher at the Solidarity Research Institute (SRI).
“In 2019, Capitec took back its title as the bank who offers the cheapest account to low-income users. Capitec is still the only bank that offers good interest rates on transactional accounts, which can help a user with a minimal balance in their bank account reduce their bank charges even more,” explained Mynhardt.
Regarding banks’ flagship accounts, a combination of bank charges and rewards programmes is starting to become the predominant factor for users. Capitec remains the cheapest bank for users who have no need to participate in a rewards programme.
“For users seeking rewards programmes, FNB’s Gold Cheque account will offer excellent value, with users getting access to FNB’s rewards programme, eBucks. It is also the only account in this category, besides Capitec’s, which offers reduced bank fees from last year. As a result of this reduction, FNB’s Gold Cheque account just passed Standard bank’s Elite Bundle account – the cheapest option with benefits of last year.
Transaction accounts for upper middleclass users are probably the most competitive. The types of benefits in this category are very similar across the spectrum of all the banks, and the difference in costs between the different banks are the smallest in this category.
“However, FNB Premier Cheque and ABSA’s Premier account were the only two to offer a reduction in bank charges. ABSA’s Premier account is also the most affordable account in this category – the cost hereof is comparable to the most expensive accounts in the previous categories. Despite FNB also offering a reduction in bank charges, Standard Bank’s Prestige Rebate account is the best option besides ABSA’s,” Mynhardt pointed out.
“This year’s report includes an analysis of international accounts and foreign exchange. This is included amid local uncertainty and an often, volatile Rand. The goal is to expose users to options to diversify by investing in foreign currency. These accounts are typically, accounts that can be linked to an existing transaction account with no cost or minimum balance that allow users to purchase foreign currency. ABSA, FNB, Standard Bank and Nedbank all offer such an option, while Capitec is the only bank that does not offer this option,” concluded Mynhardt.
Download the report here: