South African Banks @ War

It took a very long time for Standard Bank to re-look at their pricing strategy and amend it in accordance with what the South African Government has been driving –having lower bank fees. In October 2011 Deputy Finance Minister Nhlanhla Nene said that the Government was in discussion with the banking sector to reduce transaction fees in order to foster savings according to Business Report.

However Standard Bank went about it in an unruly manner which backfired triple fold. Was it necessary to complain against FNB to the ASA? But more disappointing is the fact that FNB reverted back in the same manner by complaining against Standard Bank with regards to their new Pricing Strategy promising to save customers (such as myself and you) up to 50% on bank Fees from the month of April 2012.

The recent Twitter war that took place between FNB and Standard Bank was completely unnecessary and childish. Yes the competition is high and it does not help that two of the BIG Four Banks have been outdone by Captiec’s brilliant Zero Bank Fees Pricing Strategy.

Capitec’s Global One account was in 2011, the least expensive current account. This was followed by FNB according to the Solidarity Research Institute. The institute reported that Standard Bank and Absa were the most expensive of the five banks (ABSA, Capitec, FNB, Standard bank, Nedbank).

Having said the above, we wait in anticipation to see whether Standard Bank’s new pricing strategy will enable it to move from being one of the expensive banks to bank with; or closer to Capitec’s lower-transaction fee strategy. According to Peter Schlebusch, chief executive officer of Personal and Business Banking, the company plans to cut bank charges by about 500 million rand.