South Africa's banking fees are among the highest in the world, and this makes it especially important that you take advantage of any discounted banking packages for which you qualify.
A Personal Finance reader found to his dismay that he had spent more money than necessary on bank fees, because he did not switch to a bank package for senior citizens when he qualified for it.
The reader, now aged 62, calculated that he could have been paying a monthly bank fee that was one-fifth of the amount he had been paying since the age of 55.
He believed that First National Bank (FNB) should have notified him that he qualified for the Encore account from the age of 55. He asked FNB if he was entitled to be reimbursed for the additional charges he had paid over the years.
Steve Higgins, the spokesperson for FNB, says the bank has had a number of complaints of this nature over the years, and FNB had asked the ombud for banking services for advice on the matter.
Clive Pillay, the ombud, says that according to the code of banking practice, the onus is on you, the consumer, to stay informed about your account options, and the bank is not liable to reimburse you for paying higher fees.
The code states that it is the consumer's responsibility to arrange his or her accounts in a way that best meets his or her needs. According to the code, "you should make yourself aware of the opportunities for savings and investments in the financial market place". This, Higgins says, applies equally to deposit accounts, where the rates of return vary.
"It is the bank's duty to communicate clearly, and so we have clear advertisements informing consumers of the facilities available to them - in branch brochures, in annual price review letters and on the bank website," he says.
When you turn 55 years of age, you qualify for the following senior banking packages at the various banks:
- The Encore account at FNB. The benefits include two free cheques a month, free cheque books, no annual or monthly Visa cheque card fees, and a 50-percent discount on your annual credit card and petrol card fees. There is no monthly service fee if you maintain a minimum monthly balance of R7 000. If your balance is less than R7 000, you pay a monthly fee of R98, for which you are allowed 35 transactions a month.
- The Prosperity transaction account at Absa. There are three pricing options: a monthly fee of R30 and pay-as-you-transact; maintain a minimum monthly balance of R15 000 and bank for free; or pay a management fee of either R130 for less than 30 transactions a month or R240 for more than 30 transactions a month.
- The Optimum current account at Nedbank. This account is exempt from most transaction charges (such as for transacting at a till-point, ATM mini-statements and debit orders) and service fees, provided you maintain a minimum monthly balance of R10 000. There is an annual service fee of R130. If your monthly balance is less than R10 000, you pay for the transactions you make.
When you turn 60 years old, you qualify for a Consolidator account at Standard Bank. This account includes 30 electronic transactions, eight ATM cash withdrawals and two Autobank cash deposits a month, as well as free internet banking. If you maintain a monthly balance of R10 000 or more, Standard Bank will refund your fees on a tiered basis, based on your balance.