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GRANDPARENTS often want to open a bank account for their
grandchildren to encourage them to save.
The problem with many existing products is that there is
always a monthly bank fee that eats into the children’s savings.
While perhaps a good lesson in the cost of banking, such
bank fees hardly encourage children to save their pocket and birthday money.
Bidvest Bank has since removed its R15 monthly account fee
for all customers under the age of 21, and pensioners pay no transactional
charges. The account makes it a very attractive offer for both grandparents and
their grandchildren.
Kids’ banking
Parents who want to instil a sense of financial discipline
in their children can, for example, open a Bidvest Bank account for their
teenagers and deposit enough money each month to cover their entertainment and
even basic living requirements, such as clothes and toiletries.
With no monthly
fee and no charge for transactions at the till point, teenagers can manage
their own money at no cost.
The account can also be used to save birthday and pocket
money as the minimum amount to open the account is R50 and it pays out some
interest, although limited.
The account does have fees for debit orders and ATM
withdrawals, but if used as a basic transaction account to buy items using the
card it is very cost effective.
Cash withdrawals can become expensive as Bidvest Bank has a
limited number of ATMs – only 52 across the nation – and customers have to rely
on other banks’ ATMs, which can be more expensive.
Customers can reduce their
withdrawal costs by drawing money for R2 at major retailers such as Pick n Pay
and Checkers.
However, if they use another bank’s ATM, it would cost about
R11.50 to withdraw R500, for example.
Pensioners’ banking
Bidvest Bank has waived all fees for customers over the age
of 65. This means free banking, even if the customer withdraws cash from a
non-Bidvest ATM.
The only time fees will be charged is a penalty fee of R10
if a debit order is returned or for over-the-counter transactions, as opposed
to ATM or internet banking.
Bidvest Bank also offers excellent deposit rates. For
example, their 121-day notice account pays an effective interest rate of 6.5%,
so a pensioner could keep their savings in the 121-day notice account and have
the interest paid into their no-cost bank account.
Ordinary banking
For customers between the ages of 21 and 65, Bidvest Bank
has capped the fees at R72 a month. This means that no matter how much banking
you do, your fees will never exceed R72.
As it is a basic pay-as-you-use bank account, if you only do
a few transactions a month your banking fees could be lower.
While not as
competitive as Capitec Bank Holdings [JSE:CPI] for low transactional users, for customers
who make frequent transactions every month this bank account could save a
significant amount of money.
The downside is that Bidvest Bank branches are fairly
limited, with only 52 across the nation and only found in major retail centres.
However, if a Bidvest branch is within reasonable distance and you want to open
an account for your children or as a pensioner, this is definitely an account
to consider.
- City Press
