SA banking fight on price and services
South Africa’s major banks are fighting for market share by promising consumers lower bank fees and a more customer friendly experience.
In its latest advertising campaign, Standard Bank promises to help customers to save up to 50% on bank fees. This, Standard Bank says, will be achieved through initiatives like flat-rated banking costs and lower transaction costs.
Capitec is also promoting the fact that they offer competitive bank costs, and that they simplify banking for their customers.
In some of their promotional material, Capitec even provides consumers with a table which can be used to compare your banking charges with that of Capitec. Underneath the table Capitec added a simple 4-step guide on how to switch banks.
FNB is widely seen as the leader when it comes to online banking and using technology to assist consumers, and the company is actively promoting their range of innovative products and services.
FNB is also encouraging consumers to switch to them, using their advertisements to compare their services (which are promoted as being superior) to that of their competitors.
Absa, in turn, is saying that it has been “voted best bank in Africa” at this year’s Asian Banking International Awards. The company is further promoting a range of services, which improve convenience like cellphone banking, free e-statements and Cashsend.
Getting nasty
The fight for customers was always going to have a fallout – and FNB and Standard Bank have both lodged complaints with the Advertising Standards Authority of South Africa (ASA) related to the other’s ads.
Standard Bank explained that their complaint follows an advertisement by FNB in which it claims that it is the only bank to offer free online, cellphone and telephone banking.
“Standard Bank also offers free online, cellphone and telephone banking and, in fact, lodged a similar complaint against FNB with the ASA in March 2003,” the bank said in a statement.
“In its latest advertising, FNB also claims that it is the first to offer an account with no monthly management fee. Standard Bank’s Mzansi account, which was launched on 25 October 2004, has never had a monthly management fee.”
FNB hit back with their own ASA complaint, saying that Standard Bank’s claim that it was saving customers up to 50% in bank fees is misleading.
“FNB’s position is that the advertisement sets out to sell non-existent or non-available products; this practice is prohibited by the ASA,” said Bernice Samuels, FNB chief marketing officer.
When asked about the aggressive marketing campaigns taking place in the banking sector – particularly around mobile and online banking and fees – Capitec was confident about the issue.
“We believe that all the traditional banks will have to make a noise in this field if they want to survive. Our DNA from day one was to lead in terms of innovation; we therefore do not have to scream as loudly as they do.”
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