FNB makes concession on charges
Johannesburg - FirstRand retail banking unit FNB has made limited concessions to one of its more outrageous banking charges but has warned it will continue to penalise those of its clients on cheaper fee packages who use the infrastructure of other banks to transact.
It comes weeks after a colleague on one of FNB’s lower cost fee packages drew R100 from an Absa-branded ATM at a garage forecourt – and was charged R32 for the privilege.
In future FNB’s clients on its cheapest banking packages will first receive a friendly warning shot across the bows before being lumbered with the lofty 32% charge. FNB CEO Michael Jordaan is on record as admitting the fee was unfair and needed to be changed.
“To make the fee fairer on clients who only occasionally use other banks’ ATMs – but to still strongly incentivise the use of FNB channels – we’ve lowered the fee for the first withdrawal in a 12-month cycle to R12.20, thereafter additional withdrawals will be charged at R32. We will also SMS those customers every time they use a non-FNB ATM to remind them the transaction isn’t included in their pricing package, and that next time the higher fee of R32 will apply,” said Jordaan in an email.
Critically, the bank has also agreed to amend its deceptive statement reference of “non-FNB fee” to the more accurate “non-FNB ATM cash withdrawal fees”. The previous statement reference created the impression the fee was levied by the competitor bank. The changes to the bank’s euphemistically named “Unlimited Pricing Option” is valid from 1 July.
Cautioned Jordaan: “Manual transactions and transactions at non-FNB ATMs are charged for at higher-than-normal rates to encourage usage of our most cost-effective channels… we acknowledge nobody appreciates a charge they aren’t expecting and that it’s easy to forget your fee structure – especially for transactions you don’t do very often.”
FNB has come under fire for some of its more adventurous pricing policies while continually labelling itself as having the sector’s lowest fee structure.
“Later in the year we’re also hoping to have on-screen ATM messages alerting our customers to such charges. This, however, requires an industry-wide initiative and we’re working towards this,” says Jordaan of one of the few requirements published by the bank charges commission investigation that sought to get more clarity on the way fees are charged.
Successive annual ITAL Finweek END ITAL bank charges investigations have revealed the innate complexity of the fees levied by the SA’s banks and – despite demands by the Competition Commission for clarity and greater simplicity – the sector has been reticent to comply speedily.
* This article was first published in Finweek.
* To read more Finweek articles, click here.
Little Sipho saves R50 into his acc every week. R2,600 for xmas. Clever boy. FNB sucks R1,088. As R14(!) x 52 + R30 pm admin. Bal R1,512 not R2,600. "haibo ma, mina never save again".
Wow Bruce, take the emotion out of it. ""The changes to the bank’s euphemistically named “Unlimited Pricing Option”". I have been a Unlimited customer for a while now, and it is truly unlimited if you just follow a couple of simple rules. It is not a "gotcha". It is a very clear disincentive, and the reason FNB placed the disincentive there in the first place is the SASwitch fee game Standard Bank and ABSA started playing. FNB is on record for proposing that the SASwitch fee be removed entirely. But until that time happens it is in their and the consumers best interest for the consumers to not use other bank's ATMs. It is a similar game to the interconnect charges by mobile networks. FNB is breaking down the barriers and should be commended for it.
The disincentive is obviously a tricky point. They actually should have disabled the option to use other ATM's completely. But the fact is that emergencies might arise - R32 is a good price to completely stop casual use of other ATM's but not too high for true emergencies.
I am about to have my bond paid up, and will never put a cent near FNB again. Do what you like FNB , I don't give a continental.
I feel like you do, but towards all 4 "big banks".
So, where do I go from here? I have a credit card (usefull when used correctly), garage card linked to an account with a limit, settled monthly and a home loan all linked. No pont in moving if I cannot move all. I would like not to scatter my banking services.
Capitec Bank is the best. Withdrawal fee any ATM is R7.00 and on any amount too even if it is over R1000. I won't ever bank with one of the other 4 banks again. My bank charges went from R500pm down to R120pm.
If the charge is R32 per transaction when using an alternative banks atm then FNB better make sure it has money in its damn atm's when I need to draw. Is there anyway of charging them if they don't provide the service?