We compared South Africa’s cheapest bank accounts for 2020

South Africa’s entry-level bank accounts vary greatly in form and functionality, with several lenders even offering more than one entry-level account.

For example, Nedbank has an extremely basic account in its MobiMoney account, which carries no monthly costs, but limited transactional capabilities.

The same can be said for the FNB Easy Zero account, which was formerly a mobile-only account with no card. This has changed for the 2019/20 period, but the account still cannot be used for debit orders.

These accounts are meant for low transactions (with limits set on how much money can be processed each month), with entry-level bankers looking for slightly more sophisticated transactions encouraged to move to the next tier.

It should also be noted that many of these accounts also offer rebates and interest on positive cash balances, which can offset many of the monthly transaction costs. These have not been taken into account here.

Below, we look at 14 entry-level accounts offered by 10 South African banks, and how they compare on the cost of putting money in, taking money out, and maintaining the account, month-to-month.

Monthly account fees

The South African banking industry is in a race to zero, largely being run in the entry-level segment.

Of the 14 accounts available to the market, six are zero-rated in terms of monthly account fees – all of which have been launched or made zero-fee in the last year or so.

These zero-fee accounts represent a new push in digital banking, forcing legacy bank accounts (the older entry-level accounts from Absa, FNB and Standard Bank) to compete.

2020 has seen several reductions in these fees, with price cuts from Absa, FNB and even Capitec, and most fees now settling around the R5.00 per month level.

Withdrawal fees

TymeBank doesn’t have its own native ATMs, instead, through its partnership with Pick n Pay and Boxer stores, it uses those cashpoints as its main point of withdrawal. When withdrawing from these till points, customers incur no charges.

TymeBank aside, most entry level accounts have settled around R6.00 to R7.00 for a withdrawal (per R1,000 drawn).

The only banks to step outside this are Standard Bank’s Access account, Nedbank’s MobiMoney account (where withdrawals are one of the few transactions you can actually make), and FinBond’s accounts. FinBond’s accounts use a fixed fee plus percentage of the transaction value to calculate the cost of withdrawals, which puts it on the higher end of the spectrum.

Banking customers are encouraged to make withdrawals and perform other banking services at a bank’s native ATM.

While entry-level accounts still pay far less than mid- or high-tier counterparts, customers can still see fees shoot as high as R21.50 per withdrawal if using a different ATM.

Here, African Bank is most forgiving, with its native and other ATM charges being kept the same – meaning its customers can effectively withdraw money from any ATM without worrying about paying a hiked fee. This is also where the bank derives its “lowest banking fees” title from, as the rate is not conditional on the type of ATM being used.

On the other side of the spectrum, Absa’s ‘other ATM’ fees are the same as its other accounts, meaning it reflects the same punitive price.

Deposit fees

Putting money, especially cash, into an account also incurs costs – however, some banks have moved to make this as cheap as possible, and in some cases, free.

FNB Easy Zero and Nedbank MobiMoney both offer free deposits, but only within limits (R1,500 and R4,000, respectively). Within the confines of this comparison, which looks at low transaction values for entry-level bankers, this appears to be the best value on offer in this segment.

Bank accounts aimed at these lower-spend segments keep deposit fees generally low, though they remain on par with other (mid- and high-tier) accounts.

Fee changes 

The graph below shows the periods through which the fees below are valid.

Bidvest Bank has not changed the Grow Account’s fee structure since it launched in August 2018, but its transact account was updated for August 2019, so we have used that as the fee review period.

FinBond did not provide a guideline for when its fees would be updated, but confirmed that the fees below will be valid into 2020.

Discovery Bank does not have an entry level transactional account and thus has been excluded.

Absa’s full 2020 pricing can be found here.

Standard Bank’s MyMo 2020 pricing can be found here. The Access Account 2020 pricing can be found here.

Nedbank’s 2020 pricing can be found here.

You can findFNB’s Easy 2019/20 pricing guide here. The Easy Zero 2019/20 price guide is here.

You can review Capitec’s full 2019/20 pricing here.

You can view the FinBond FinSave Lite and FinSave Value fees here.

You can view the African Bank MyWorld Account fees here.

You can view the TymeBank Fees here.

* At Shoprite, Checkers and uSave

You can view the Old Mutual Money Account fee schedule for 2019/20 here.

You can view the Bidvest Bank Grow fee schedule here.

Read: The cheapest and most expensive bank accounts in South Africa