Bank charges are the scourge of all of us. According to research conducted in South Africa, increased competition is shown among the nation’s banks regarding driving down fees. However, increased financial pressure on consumers means charges, although lower, can still be a significant burden.
Advocate Clive Pillay said that charges levied on ordinary cheque accounts can be fully negotiated. This is due to the fact that there is no law or code regulating the negotiation of bank charges. In the instance of a “big account” which a lot of activity and a substantial balance, a bank would be more likely to negotiate a reduced rate, to retain the customer, than it would in the case of a “small account”, with little activity such as a salary deposit each month and a number of withdrawals during the course of the month with a very low balance. However, it’s important to understand that the bank can refuse lower charges by exercising their commercial discretion.
Many banks offer two types of basic cheque accounts, pay-as-you-transact (PAYT) and bundle accounts. Depending on the amount of activity on your bank account, one option may prove more cost-effective than the other. Bundle accounts, offered by the big four banks, comprise fixed monthly fees for a package of transactions including finite cash deposits and withdrawals, and often unlimited electronic transactions and notifications. Any transactions which breach the bundle limits are typically charged on as PAYT basis. The PAYT charges offered by Absa and Standard Bank include a minimum monthly service and additional fees per transaction. Capitec’s sole account option, the Global One Account is a PAYT account.
Multiple ATM withdrawals, especially those over and above bundle limits can significantly increase your bank charges. Instead, you should opt to withdraw cash at a point of sale from a participating retailer, for example, such as a major supermarket.
You can perform a broad range of functions online, and it is often free and if not cheaper and more convenient than seeking help over the telephone or visiting a branch. Opt for a bank with free online banking and take advantage of this service.