In South Africa’s apparent competitive environment, it seems big name companies that are supposed to be in competition often work together to fleece the consumer. Banks are no different.
It was with disgust that I read in this article exactly how much South Africans have to pay banks to handle their money. You pay to deposit money, you pay to withdraw money, statements, transfers, bill payments, even online banking. They all attract fees.
A long time ago I had a Nedbank account, but I had to close it as even though it was not being used, it was gradually being sucked dry by monthly banking charges in spite of slightly more than modest balance. Nevertheless, the interest didn’t even start to cover the banking charges.
The article also says that last year South African banks raked in R51 billion (that’s US$7,500,000,000) in banking fees alone. US7.5 BILLION!
How is that possible?
The banks claim their charges are in line with their expenses, yet one bank can charge R5 for a bounced debt, while the others charge R10. Is every business in South Africa out to screw the consumer?
The Inevitable Comparison
In (insert your country here, mine is Malaysia) my day to day banking costs me nothing. Nothing!
I bank with Maybank. I have access to Internet banking. It costs me nothing. I can deposit money at any ATM or even the counter. It costs me nothing. I can withdraw money 4 times per month. It costs me nothing. After that I get charged 50c per withdrawal.
I have a Visa debit card. It costs me nothing to own or use (although losing or breaking it costs me RM12 to replace it). If I withdraw money from another bank’s ATM, it costs me RM2.
On the other side of the coin, Maybank also pays very little interest. Do I care? No. Because the lending rate in Malaysia is so low, even on thousands of RM the monthly interest is quite low.
But I would give up a little interest on my day to day account in exchange for virtually free banking any day.
I wonder how that would fly in South Africa?