How to get the best deal on your personal cheque account.

How to get the best deal on your personal cheque account.

Bank charges are the bane of many customers.

The latest report by the Solidarity Research Institute shows that increased competition among the nation’s banks appears to be driving fees down. But increased financial pressure on consumers means charges, albeit lower, can still be a significant burden.

So, how do you get the best possible deal on your personal cheque account?

Negotiate your bank charges

There is no law or code regulating the negotiation of bank charges. But Advocate Clive Pillay, the Ombudsman for Banking Services, says the charges levied on ordinary cheque accounts can be fully negotiated.

“In the case of a ‘big account’ with much activity and a reasonable 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,” he told Moneyweb.

However, it is important to note that the bank can refuse to negotiate lower rates by “exercising their commercial discretion,” says Pillay. In which cases, customers can do little but switch banks, provided the new bank offers lower rates.

If that fails, there are other relatively simple ways to save money on bank charges.

Make sure your account suits your needs

Some banks offer two types of basic cheque accounts: bundles and pay-as you-transact accounts. Depending on the amount of activity on your account, one option may prove more cost-effective than the other.

Bundles, offered by the big four banks, comprise fixed monthly fees for a package of transactions including finite cash deposits and withdrawals, and oftentimes unlimited electronic transactions and notifications. Any transactions which breach the bundle limits are typically charged on as pay-as-you-transact (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.

Cheque Account Fees 2017

Bundle Monthly Service Fees PAYT Minimum Monthly Service Fees
Absa Gold Cheque Account R98 R42
Capitec Global One Account* N/A R5
FNB Gold Cheque Account** R100 N/A
Nedbank Savvy Plus Account R100 N/A
Standard Bank Elite Account R100 R55

* Capitec’s fee structure is due to change from March 2017, fees quoted are based on the 2016/2017 pricing guide.

* FNB’s fee structure is due to change from July 2017, fees quoted are based on the 2016/2017 pricing guide.

Maintaining a bank’s prescribed minimum account balance can also reduce or, in some cases, negate transaction fees.

Ditch ATM withdrawals

Multiple ATM withdrawals, especially those over and above bundle limits can, significantly increase your bank charges. Instead opt to withdraw cash at a point of sale (POS) from a participating retailer, such as a major supermarket. If you really must get cash from an ATM, ensure you use your own bank’s machine as a cash withdrawal at another bank’s ATM, a Saswitch withdrawal, is considerably more expensive.

ATM Withdrawal Fees 2017

Native Withdrawal Fees Saswitch Withdrawal Fees POS Withdrawal Fees
Absa Gold Cheque Account R3.95 + R1.35/R100 R9.95 + R1.35/R100 R3.95
Capitec Global One Account* R5.50 R8.50 R1.30
FNB Gold Cheque Account** R1.85/R100 R7 + R185/R100 Free
Nedbank Savvy Plus Account R4.50 + R1.40/R100 R11.50 + R1.40/R100 Free
Standard Bank Elite Account R1.80/R100 R6.70 + R1.80/R100 R1.80

* Capitec’s fee structure is due to change from March 2017, fees quoted are based on the 2016/2017 pricing guide.

* FNB’s fee structure is due to change from July 2017, fees quoted are based on the 2016/2017 pricing guide.

Honour your debit orders

Ensure that you have sufficient funds in your account to avoid high fees. Fees can be incurred for dishonoured payments due to insufficient funds, or for payments that have been honoured (direct debits) before the bank systems realise you don’t have sufficient funds in your account.

Debit order charges 2017

Internal Fees External Fees Dishonouring Fees Honouring Fees
Absa Gold Cheque Account Free R16.95 R50 R50
Capitec Global One Account* R3.40 (branch) R3.40 (branch) N/A N/A
FNB Gold Cheque Account** Free Free R25/R100 (max. R100) R25/R100 (max. R100)
Nedbank Savvy Plus Account Free Free R60 (R150 per item for four or more items in 12 months) R90
Standard Bank Elite Account R4.50 R16 R115 R130

* Capitec’s fee structure is due to change from March 2017, fees quoted are based on the 2016/2017 pricing guide.

* FNB’s fee structure is due to change from July 2017, fees quoted are based on the 2016/2017 pricing guide.

Take advantage of online banking

Performing a wide range of functions online is often free and if not cheaper than seeking help over the telephone or visiting a branch. Opt for a bank with free online banking and take advantage of this service.

Review your statements

“Check your charges monthly to make sure you are not being charged for services you are not using and if there is something on your statement you do not understand ask your bank about it,” advises Pillay.

Adapting your banking behaviour and taking heed of your bank’s attempts to incentivise lower-cost channels, can result in savings.

Source : Moneyweb

About the Author

Charl Oosthuizen
Independent Financial Advisor / Onafhanklike Finasiële Adviseur Ultrafin Finansiële Oplossings (Edms) Bpk / Financial Solutions (Pty) Ltd FSP 35757 Cell: 083 377 1441 | Fax: 086 617 8137 | Tel: 086 111 4602 Besturende Direkteur. Charl is sedert 1990 betrokke by versekring. Verantwoordelik vir oorhoofse bestuur van maatskappy, met spesifieke fokus op die Kort Termyn Afdeling as ‘n boer in murg en been lê die landbou vir Charl baie na aan die hart. Dus vorm Agri Versekring en gepaardgaande NIS produkte ‘n belangrike deel van Ultrafin se Potefeulje.

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