Fin24

Absa defends bank charges

2011-10-21 11:58

Johannesburg - Absa Group [JSE:ASA] defended its relatively high banking fees saying on Friday they focus on "value for money, rather than price".

"We believe there is sufficient evidence that we provide value to our customers with choice, convenience, accessibility and security," it said.

This followed a banking fee survey by trade union Solidarity which declared that Absa was one of the two most expensive banks in South Africa, followed by Standard Bank Group [JSE:SBK].

Absa said it welcomed any report that drew attention to the fact that customers had products best suited to their needs, and that these needs changed over time.

"At Absa we know that no two customers are alike and therefore we have online fee calculators and highly trained staff, who can advise customers on their individual and unique transactional needs."

Customers' needs went beyond just a transactional account - such as car and home finance, and lending - and Absa considered these aspects when giving advice.

Their customers also had the benefit of their relationship with global group Barclays which helped do business globally.

"At Absa we focus on value for money rather than absolute price."

With over 8700 self service terminals, its network was 28% larger than their nearest rival, said Absa.

"Convenience, accessibility and safety are factors that are very easily overlooked in reports of this nature."

Comparative charges

The Solidarity research institute (SRI) compares the bank charges of the various personal bank accounts offered by the country's five large commercial banks - Absa, First National Bank, Standard Bank, Nedbank Group [JSE:NED] and Capitec Bank Holdings [JSE:CPI].

Capitec's Global One account was found to be the cheapest.

"The average bank charges of this account over eight different user profiles amount to R67.35 a month and have not been increased since 2010," said Paul Joubert, senior researcher, on Thursday.

"Absa's cheapest option, the Silver Package account, has average monthly charges that are more than double that of the Capitec account.

"The charges also rose by 8% from R140.90 to R152.15, between 2010 and 2011," he said.

FNB's cheapest account was the Smart Unlimited with a monthly bank charge of R73.10.

Nedbank's cheapest was Savvy Electronic account at R105.04 monthly.

The cheapest Standard Bank account was its Classic Cheque fixed fee account at R133.43.

These costs were calculated using an average of eight transactional profiles and excluding minimum balances and the effect of interest.

Capitec also has the least expensive transmission account - an account without an overdraft facility.

However, when linked to an overdraft, a chequebook and a credit card, FNB offers the cheapest current accounts, according to the report.

Business accounts were not included in the comparisons and the analysis of the bank charges was based on various hypothetical scenarios.

Comments
  • pagel - 2011-10-21 12:37

    I should get another bank.

  • Ryan - 2011-10-21 12:39

    Keep telling yourself that. Thats why i will be moving to FNB.

      Tolerant - 2011-10-21 13:18

      FNB caters for all but prefers clients without debts / limited debts.

      Vikash - 2011-10-21 13:21

      Well said, Joe ;-)

      Ryan - 2011-10-21 14:17

      Well, then i am in luck. I don't have much debt.

  • Derek - 2011-10-21 12:44

    boicott ABSA!!!!!!

  • Joe - 2011-10-21 12:48

    You get first world service for FREE when you bank in the US. Checking accounts doesn't cost you a PENNY. You can use checques all day long, and it doesn't cost you a PENNY! NOT ONE! Try using a checque in SA... You can even instruct (over the internet) the bank itself to pay someone with a checque, and it doesn't cost you a PENNY! In SA, banking is ALL about profit, and not in the least about 'customer service'! What rubbish! Why do you think that UK bank bought ABSA a few years ago?? PROFIT! That's why!

      PhatCatt - 2011-10-21 13:03

      Joe - whenever there is an article about banking fees, someone always pipes up with how banking is free somewhere in the world. It's not a clever argument or comment - rather it just shows your complete and absolute ignorance of the economics of banking. I challenge any reader of these comments to make an intelligent argument about how bad our banks are compared to other banks and I will be able to refute and prove you wrong.

      Inhlanzi - 2011-10-21 13:05

      Everything's FREE hey? Might explain why there's a banking crisis over there?

      Agnostic - 2011-10-21 13:54

      @FatCatt - You are obviously a banker... Lets take this "Service" that ABSA has. You can transfer money into any SA bank (Inter bank) and the money can be available immidiately, but you need to pay for that service. What does it cost them to allow that service on all transfers? UK banks - Internet banking Interbank transfers happen immidiatly. (no charge)

      amaKK - 2011-10-22 02:16

      @PhatCatt Nonsense argument on your part. Pointing out that other countries can provide to clients, for free, the same services that SA banks charge healthy limbs for is a very, very valid argument. Have you had a look at the massive gap between interests given on savings accounts and interests charged on credit? That's where the profits are. And the banks in SA are not safer because they steal from us, they are (largely) immune from the global crisis because of the governments timely intervention - NCR. They remain as greedy as international banks by granting loans to unqualified clients. Get a grip.

  • Sharkie - 2011-10-21 12:50

    ABSA is insanely expensive - cannot believe I stay with them for so long. ABSA internet banking:R110.00/month FNB interney banking:Free ABSA cell phone app - non FNB cell phone app - free - and fully functional, can make payments, transfer money the lot! and I don;t mean cell phone banking - i mean actual app for smart phones and for how much? R92/month!

      Johnny-BB - 2011-10-21 12:59

      ...ABSA's bank charges are so high because ABSA deduct extra charges from their clients, to sponsor SA Rugby and SA Soccer...

      Sharkie - 2011-10-21 13:09

      Johnny - is that our problem? NO! ABSA were charging me between R200 and R300 in banking fees every month, lately R110 worth JUST for internet banking. I switched to FNB in May - havn;t looked back - unlimited debit card and atm withdralsm, internet banking, notifications which are quick, all for just R92.00

  • Koos - 2011-10-21 12:54

    and what does one get for that R152 *12?

  • Agnostic - 2011-10-21 12:57

    All bank charges are unconstitutional. We are forced by the government to keep our money in the bank. However we get charged for it. That will constitute an additional tax on the taxpayer. We have no means of keeping our money anywhere else so why are we forced into paying bank charges. In the UK the courts found that charges are not justifiable and all banking is free.

      Tolerant - 2011-10-21 13:17

      You can always keep your money in a safe, no law against it. You just have to remember to pay your taxes.

      PhatCatt - 2011-10-21 13:26

      Agnostic - lets deal in facts, should we (not wishes). Bank charges are not unconstitutional. You are NOT forced to keep your money in a bank - there are hundreds of thousands (if not millions) of employed people in SA who are paid cash wages which never end up in a bank. In terms of the UK courts - even if we ignore the minor issue that UK banking laws are different to our own (possible becuase the entire UK basis of law is different to our own) you are wrong again! The UK Office of Fair Trade (OFT) brought a case against banks for charging fees on overdrafts which had not been pre-agreed with the customer (in other words, the OFT was saying that banks could not charge for an overdraft if the charges had not been pre-agreed with the client). Although they won the original High court case, they lost an appeal to the Supreme Court. So, not only do UK banks charge fees, in many cases (ATM withdrawls etc.) these fees are much, much higher than here in SA.

      PhatCatt - 2011-10-21 14:18

      Agnostic - not a banker, but like to get facts before I foorm an opinion. As to your comment around internet banking - do you honestlly think that the infrastructure, servers, software development, security, support staff etc. cost nothing? Do you honestky think that if I don't charge you to use internet banking that I don't recover the cost of providing internet banking somewhere else? Really? If so, then I have a lovely, low-usage bridge I'd like to sell you.

  • Anton - 2011-10-21 12:57

    I personally have had very good service from Absa. I have 2 bonds, a cheque and credit card and pay less than my wife for he FNB account. The absa rewards you get in cash and not ebucks like fnb and mymonthly rewards is more than my bank charges.

      amaKK - 2011-10-22 02:05

      Who needs rewards or ebucks or other thinly disguised programs to pacify you as they pilfer from you? All I ask is let my money be. Capitec does that oh so nicely. I earn at least ten-fold in interest what I pay in banking charges. In cash. All mine to decide where to spend it. Beat that.

  • Bokke - 2011-10-21 13:00

    I just moved my account to FNB because ABSA was very very very expensive!!! In September I paid about R270 in bank charges (about R200 of this amount was internet banking charges)!! At FNB I am getting more than what I was getting at ABSA for a fixed amount of R92!! Thatha FNB THATHA!!!

      Sharkie - 2011-10-21 13:11

      Bokke - also moved in May - what a pleasure! friendly, helpful staff, great banking products and low bank fees! And the bb app is awesome! Go take a look at ABSA's buildings in Jhb CBD - THAT's where your money is going!

  • Ryan - 2011-10-21 13:05

    Trust me on this. FNB are not any better. I've been with them since 95. Horrible service and crazy bank charges. Just moved to Capitec, much happier now. It was a really good move.

      Renny - 2011-10-21 13:16

      I can second that!

      Vikash - 2011-10-21 13:17

      Ryan, I am seriously thinking about changing to any bank from FNB. You are so right about their service and bank charges. On the service issue, I sent three emails over two months ago to my Relationship Manager and still no response. The only excuse I am going to be happy with is if he died two months ago! FNB are pathetic as a business bank! Terrible service and they always seem to think they're doing you a favour. After all we've been dealing with them as a company since 1941 (from the Barclays days), but that loyalty we have shown them has counted for nothing! Time to change my bank, me thinks ;-)

  • nathan.blows - 2011-10-21 13:08

    I'm moving my bank accounts over from Absa to FNB, too. This past month alone I've probably spent close to R300 on bank charges. They've even started charging me for things that were supposed to be covered under a monthly admin fee (that I also still get charged). I'm not even going to fight with them, I'm just moving. Bye bye Absa.

      jabuojc - 2011-10-21 13:47

      Been with FNB from ABSA since last year, after years of getting ripped off by ABSA. I had to kick myself for not joining FNB earlier

  • Onestone - 2011-10-21 13:14

    mmm... but absa never defends why they stuff up your home loan and give you 2 bonds instead of one, trying to debit R125000 instead of R6000, when applying for a provident service, they take 2 weeks to answer you, their call centre numbers are in correct but yet, for the sloppiest badest service, they are the most expensive.... i heard a rumour that absa head office in jhb were frauded in their own canteen.... this true?

  • kenneth.roselt - 2011-10-21 13:33

    Highly trained staff - where did they dig that up from... The call centre, bank service desk, and credit card dept all have different stories on certain issues... i know, as i have been told one story by the call centre, another story at the enquiries counter, and yet another by the credit card dept, all for the same query. I certainly don't believe they have well trained staff at all.

      Tanya van Staden - 2011-10-21 14:18

      At the Nelspruit ABSA branch, you stand waiting in a short queue for at least 20 minutes, because the tellers are extremely slow. When you finally get to someone that is supposed to be able to help you, she tells me to please go to the teller next to her, since she has not been trained yet for my querie... it is enough to make any calm and patient customer furious!

  • SeEkOok - 2011-10-21 13:35

    "At Absa we know that no two customers are alike" If this was true, ABSA would not have standarised forms for applying for loans, accounts, etc. Where on any of the forms do you allow me, as a unique customer, to differenciate myself from the next person in line? If ABSA truly value their clients as they claim they do, then listen up! We want cheaper service fees. I don't care how many terminals you've got out there, I care about what is left in my account after a transaction. I don't care how highly trained you think your staff are, I care about me and the money that I have to pay you in order to get access to MY money. I don't care that you are one of the largest banks in the country, I care about the fact that you rip me off. To you I'm just a couple of numbers on some system somewhere ready to be taken for a ride. Take some of those millions that you make profit each year and give back to the people that makes that possible - your clients.

  • Luigi - 2011-10-21 13:36

    I never had a problem with ABSA,give's good service compared to FNB which I have my homeloan with.But I must say that ABSA is extremely expensive with their bank charges which i think is madness compared to most banks.I wonder how is Standard bank cause I only hear compliments from that bank.Wish they could lower the bank charges in this country cause i def think it is a rip off.

      ebudae - 2011-10-21 14:20

      Standard bank sucks. As someone who banked with them for almost 20 years I have to say I was sorely disappointed by their bad service. I have been receiving someone elses credit card statement every month for the last 4 years. Despite complaining to a branch manager, card division, a teller and someone who called me to ask specifically about email statements, I still receive someone elses credit card statement. they offered me, to buy my first car, only R20000. And with that I was supposed to find a car less than 5 years old. Wesbank covered my brand new car in full and it was valued at 5 times Standard banks lousy amount. Standard Bank charge R130 for a bounced debit order. And when my salary went in late one month and they had charged me 3 times, the teller had the nerve to tell me that I should have planned better. One time I complained because some dodgy characters hanging out at a standard bank ATM seemed like they might be up to no good. I think they were skimming people's cards using one of those devices they place over the card slot at an ATM. Well my card was swallowed, but luckily I had entered the wrong pin (on purpose). I immediately cancelled the card and tried to report to Standard bank about the possible card skimming. No one was interested. No one called to get more information about the men or the circumstances I found myself in when the card was swallowed. But they did charge me R90 for a new card even though mine was swallowed by their ATM. Great bank!

      Alexania - 2011-10-21 17:46

      I don't know, I've been with Standard Bank my whole life. The bank charges they list up there aren't right, the Classic account is R99 so I'm not sure where they get that from. I pay a fixed amount per month and that's what I pay, I keep an eye on my internet banking so I know. They never charge me for anything else (with the exception of petrol card transactions, but I only fill up once or twice a month and it's like R3). I have a savings account, transaction account, money market account and share trading account with them. I've always found them to be super helpful and friendly, with the odd red tape here and there. Of course, it's also true that the less you have to deal with banks the better they are. So perhaps I just haven't dealt with them often enough (yay for internet banking). A couple of months ago, my card number got skimmed and some guy went on an internet shopping spree with it, I phoned Standard Bank, and had my card stopped. I few hours later their fraud department phoned me to say that they'd noticed I'd stopped my card and whether I want to report any fraud. I told them which transactions weren't mine, they sent me and affidavit to fax back to them and in a couple of weeks repaid all my money back into my account. So yeah... I'm not saying they're the best bank their is, but I'm pretty sure you're going to find good and bad experiences with every bank, depending on the person you get to deal with it.

  • Darin Graham - 2011-10-21 13:39

    The bank charges in South Africa are extremely high and there is no excuse. In other countries like the UK most bank accounts are available free from bank charges and people can open bank accounts with no fees. You don't need to pay for letters, emails, bank statements and withdrawals. We need a bank in SA to really provide competition against the big banks.

      kidblack - 2011-10-21 18:34

      its called FNB. best bank by far.

  • CalamitySA - 2011-10-21 13:43

    They charge exorbitant fee's on short term personal loans as well, and don't take history of client's credit record into account. Publish these details as a comparison and let the public see! Absa is now a foreign-owned bank and should be treated as such.

  • CJ - 2011-10-21 13:44

    I've already applied for an FNB account about 2 weeks ago... so moving from Absa to FNB. The reason is that I've been with ABSA for around 25 years... and when I applied for a home loan, they didn't want to give me more than 85%, but not even having an account with FNB, they offered me 95% with a better interest rate. Sorry Absa, what service are you offering me here??

      Matthew - 2011-10-21 13:49

      Yup, had exactly the same experience ... no sense of loyalty whatsoever ...

  • pietdrivers - 2011-10-21 13:55

    If you draw money for wages you get charged 0.9% of the amount. Say you withdraw R60 000 your bankcharges is R540. Considering that a teller is servicing about 100 clients per day, she generates R54 000 for the bank on charges PER DAY. 4 Fridays in a month = R216 000 per month. Then there is still 18 days left in the month.

  • Tienie - 2011-10-21 14:12

    I changed from ABSA to FNB, after banking with them for 40 years, in which I never defaulted on any repayments on a previous PL or Car installment. When I wanted to buy my next (2nd hand) car, they wanted me to pay a 15% deposit. I went to Westbank and they gave me finance without any problems. A year later I applied for a PL from ABSA, they declined me. FNB offerd met twice the amount. So after being a very loyal ABSA client for 40 years I closed all my accounts. Now ABSA is offering me a Gold Cheque and Credit Card, wow!!!!

  • concerned - 2011-10-21 14:19

    When ABSA started internet banking it was for free, now its costing me betw. R1100.00 & R1350.00 A month thats without the other costs. Thanx ABSA.

      Miss Naughty - 2011-10-21 15:06

      Just checked my internet banking fees for last month - almost R500.00 for doing a few internet transfers. Never mind that I get charged about R7.00 every time I use my debit card...but it is my own fault - I was unaware and I should check regularly...

  • TKS - 2011-10-21 14:27

    This argument of high bank charges has been going on for years now. Who ever is supposed to be dealing with this matter is certainly doing the public a great disservice. I tell you what - these days it's by far much better to keep your money in the house rather than the bank. Why don't you do like I do? Bought myself a safe (a gun safe is even more ideal!)and keep all my money in there. I hardly complain about bank charges anymore! If you do not believe me, try opening a savings banking account and deposit say R200. Four to six months down the line, your money is gone. All you'l see on your statement will be: "Service Fee", "Maintenance Fee", Miscellaneous Fee" etc. I suspect some government people a getting paid for NOT attending to matters like this. For me, all these banks are the same and they collude in terms of doing business.

  • Gerhardt Kirchner - 2011-10-21 14:36

    I have had an absa account for the last 11 years. This past year I closed it and moved to FNB purely out of banking fees. It then turned out that 'cheap' FNB also provide better service than absa does. The inconvenience of changing banks was short lived and I am happy knowing I made the right decision.

  • frans.grobler3 - 2011-10-21 14:41

    You must see NEDBANK (NEED TAKE YOUR MONEY BANK - NEEDBANK) charges on my father account who is a pensioner earning R1100 pm Sis man Nedbank and I bank at standardbank ( Standard 2 still learning bank) which I am changing soon to FNB - Standardbank cost me money for there mistakes and i have proof on both above mentioned statements.

      carolyn.dewrance - 2011-10-23 10:11

      I am also a pensioner and Absa charges me fees on my R1100 a month as well even though I have written to them and been to see them about reduced fees, I was told that they used to have a special for pensioners but it no longer is active. So I am being robbed by the bank so to say and to go and change my account with the social pension department is not that easy for me, when I dont have my own transport to get the their offices.

  • Arthur Charles Van Wyk - 2011-10-21 15:44

    You charge R100 for an RD on a business transact account. How do you explain that in the face of other banks charging around R30 for the same thing?

  • Arthur Charles Van Wyk - 2011-10-21 15:46

    Oh and after paying you bank charges since I opened the business account in 2005 I was told to pay R800 for bank statements dating back to 2008. This happened just last year. The last year with FNB has been absolutely hiccup-free.

  • Frikkie - 2011-10-21 16:10

    People, Absa bank are run by the FREE MASONS! That's what you pay for. Do you really think any honest bank would charge that much to customers while using MY money to make THEM money? They should pay us a minimum of 50% interest per year without ANY bank fees. They still make a couple of 100% per year with our money!!!

      kidblack - 2011-10-21 18:35

      actually.. in the fractional reserve banking system... they create money out of thin air.

      Suzan Kepkaar - 2015-05-27 20:07

      Can u pls hlp me, im using fnb to bank my money but yoh its killing me so can u tell me which bank i should use cos my money does not grow at fnb pls hlp

  • Liam - 2011-10-21 16:17

    ABSA's service is horrible. Happy with Nedbank, pay on average R30 a month bank charges on my Design account.

  • David - 2011-10-21 16:27

    When i started a small home business and asked for a loan to buy machinery, they forced me to resign from my job even though i could afford the monthly payment.

  • rob barrie - 2011-10-21 16:33

    You dont get service at ABSA - worst of all banks and then they charge you. Dont know how to handle clients or what service to give

  • Boerseun - 2011-10-21 17:30

    I have tried in vain to get a socalled debt, lawfully verified by Nedbank. They ignore me point blanc, so in my view honesty is not part of any bank's system.

  • Kgomotso Mekgwe - 2011-10-21 18:30

    Absa charges an average R340 per month on bank charges. That's way too much. I'm in the process of going to Capitec

  • rwtheron - 2012-09-07 13:27

    Find out how banks are able to have such high fees at: https://www.facebook.com/rwtheron#!/permalink.php?story_fbid=523904057624871&id=450283458320265

  • mapetla.mahlangu - 2012-10-15 15:43

    Absa is boring i'm going to move to FNB.

  • nadia.graf.50 - 2013-01-17 15:49

    Pity that Absa were not able to provide their "valued" clients with deposit books (at a charge, of course) and plastic bank bags. For the bank bags I had to go to Standard Bank and, although I don't bank with them, was lucky enough to be given the plastic bags. The service is atrocious at Absa generally.

  • pages:
  • 1