The best deal on your personal cheque account

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.

* 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.

Leave a Reply