Sunday, January 16

Bank Zero vs TymeBank vs African Bank – fee comparison

The launch of Bank Zero earlier this year means that the country now has three banks offering commission-free transactional bank accounts.

Read: Bank Zero freezes fees, opens to all

The mutual bank joins TymeBank and African Bank in this market segment, but TymeBank and Bank Zero are unique in that they both actively target commercial clients. (There are a growing number of wallet-style solutions that also don’t have monthly fees, but they don’t offer features like wire transfers or debit orders.)

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These three accounts are very similar, with TymeBank’s partnership with Pick n Pay and Boxer to allow free cash withdrawals at retail outlets as a key differentiator.

Account holders are incentivized to use this channel as withdrawals at other retailers cost R3, more than the R2 charged by Bank Zero and African Bank.

If you likely need to deposit cash frequently, TymeBank is by far the best price at R6 for R1,000 at PnP / Boxer. African Bank’s MyWorld account charges R5 for the first R500 (or part thereof) deposited in a box, with fees of 2% of the value in amounts greater than that. That means a cash deposit of R1,000 in a box will cost the customer R20. Their fees at the cash accepting machines at their own branches are even higher, at R3 per R100.

Bank Zero is somewhat paralyzed, as it currently does not offer the ability for account holders to deposit cash.

This is a significant barrier, despite the bank’s apps-first-digital-first strategy. It can be assumed that you are surely negotiating some kind of partnership with the largest retailers in the country (Shoprite Group / Pick n Pay) to address this.

Read: South African Retailer Silently Launches Bank Account To 20 Million Customers

African Bank MyWorld Zero bank TymeBank EveryDay Personal
Monthly account fee R0 R0 R0
Card payments / swipes R0 R0 R0
Electronic transfer (own accounts) R0 R0 R0
Prepaid Airtime / Electricity 50c R0 R0
EFT to your own bank R0 R0 R0
EFT to another bank R0 R0 R0
Send money to an account at your own bank R10 (immediate payment) R0 R0
SendMoney to self (cash withdrawal without card) Not disclosed R8.50 R0
Send money to someone in another bank R10 (immediate payment) R8.50 R6
Debit order R3 R0 R0
Withdraw cash at the till (POS) R2 R2 R0 at PnP / Boxer, R3 at other retailers
Withdraw cash at ATMs R9.50 for R1 000 R9 for R1 000 R10 for R1 000
Cash deposit (up to) R5 for R500, thereafter 2% R6 per R1 000 (to PnP / Boxer)
Balance check at ATM or point of sale R0 at POS, R4 at ATM R2 R3
Initial card R0 R79 (delivery R139-R179) R0
Hassle charges (over limits, insufficient funds) R4 (R7 for rejected debit order) R2 R3
Proof of payment (email) R0 R0
Proof of payment (SMS) 40c R1.50 R0
Transaction notifications (application) R0 R0 R0
Transaction notifications (SMS) 40c 30c
Dispute / stop debit order Not disclosed R8 R9
Dispute card transaction Not disclosed R30 R9

If you withdraw from an ATM (which none of these banks have), these fees range from R9 to R10 for R1,000 (or part thereof). This is much more expensive than removing it from a cash register.

African Bank’s MyWorld account differs from Bank Zero and TymeBank in that it charges an R3 fee for each debit order. Debit orders on other bank accounts are free.

Bank Zero is the only bank that charges for your initial card (R79 for payment in Clicks or R139-R179 for delivery). TymeBank cards are issued automatically by its kiosks in PnP and Boxer, while African Bank cards are issued by its branches.

The African Bank account does not appear to have the SendMoney feature. Account holders would have to make an immediate payment, at a fee of R10.

Sending money to someone costs R8.50 for Bank Zero account holders, while at TymeBank the fee is R6.

So-called nuisance fees (eg card declined due to insufficient funds) are the most expensive at African Bank in R4. Bank Zero charges R2 for this, while TymeBank charges R3.

There are substantial differences in the interest rates offered to savers on these three accounts.

African Bank offers 2.75% per annum on its Power Pocket and 4% per annum on its Savings Pocket.

Bank Zero offers between 2.1% and 3.9% annually, depending on the amount and the duration (it has notification accounts of seven days, 32 days and 45 days).

TymeBank offers 4% on your GoalSave from day one. This can increase up to 8% after the money has been held for more than 90 days if your salary is credited to your TymeBank account and you give the bank 10 days’ notice.

Listen to Fifi Peters’ interview with TymeBank CEO Tauriq Keraan (or read the transcript here):

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