Some First National Bank (FNB) clients will be smiling and others will grumble after changes to the bank's transaction fees came into effect today.
FNB has raised the fee for over-the-counter withdrawals from cheque accounts by 167 percent, but it has also reduced certain charges. For instance, the cost of internal debit orders has dropped by between 34 and 78 percent, depending on the transaction amount.
The bank has dropped its minimum monthly service fee of R22.50 on cheque accounts. This fee has been replaced with a R10 monthly fee, which includes various costs that you previously paid in addition to the minimum monthly fee. These costs include: the cost of a cheque book (was R13.50), the monthly cheque card fee (was R4), the annual petrol card fee (was R74) and annual lost card protection (was R20) for both cheque and petrol cards linked to a cheque account.
Previously, you paid the minimum monthly service fee if your monthly charges added up to less than R22.50, or if you made no transactions at all.
The new R10 monthly fee applies to all types of cheque accounts and is not a minimum fee, Line Wiid, the chief financial officer of FNB Core Banking Solutions, says.
The rationalisation of annual fees into one monthly fee makes banking simpler for FNB clients, and encourages you to use products such as the cheque card and petrol card, Wiid says.
Over-the-counter charges
FNB has introduced a flat fee of R16 for a cash withdrawal from a cheque account over the counter. A sliding scale of charges applied previously.
The effect of the R16 flat fee is that you pay 167 percent more to withdraw amounts up to R500 over the counter, and 33 percent more for amounts between R500.01 and R1 000.
However, you pay 11 percent less if the amount exceeds R1 000.
In addition to a withdrawal fee, FNB charges you a cash-handling fee for over-the-counter withdrawals.
The handling fee for withdrawing cash from a cheque account has been increased by 27 percent, from R0.55 per R100 to 0.70 percent of the value of the withdrawal.
For example, on a cash withdrawal of R500, you are now charged a cash-handling fee of R3.50 (previously you paid R2.75).
The total cost - withdrawal fee plus cash-handling fee - to you of drawing R500 over the counter from your cheque account is R19.50 (123 percent more) and on a withdrawal of R1 000 it will cost you R23 (31 percent more).
Michael Jordaan, the chief executive of FNB Customer Solutions, says this increase reflects in part the extra costs of insurance and transporting cash that banks have to bear as a result of crime.
Wiid admits that the increase for amounts under R1 000 is high, but you have the cheaper option of drawing from ATMs.
A tip is to draw larger amounts less often, rather than small amounts often.
ATM fees
Cheque deposits at an ATM remain free, but FNB has introduced a new method of calculating the fees on cash deposits.
Wiid says this is to make it easier for you to calculate how much you are being charged for each transaction.
The fee is based on the size of the deposit rather than rounding off to the next R100.
Previously, FNB charged you R1.05 for every R100 you deposited. Under the new fee structure, you pay R2 for deposits of R250 or less, and R2 plus 0.95 percent of the value of the deposit on amounts greater than R250.
For example, to deposit R500, the transaction cost increases by 29 percent from R5.25 to R6.75. In the case of a R1 000 deposit, the fee increases by 10 percent from R10.50 to R11.50.
FNB has increased the charges of drawing cash from its own ATMs and from those of banks on the Saswitch network.
Drawing R500 from an FNB ATM costs you 13 percent more or R6.75 (previously R5.95), and drawing R1 000 costs you 10 percent more or R11.50 (previously R10.45).
The new fee structure is R2 plus 0.95 percent of the value of the amount withdrawn.
It now costs 11 percent more to draw R500 from a non-FNB ATM, or R12.25 (previously R11), and drawing R1 000 costs 10 percent more or R17 (previously R15.50).
The fee to use another bank's ATM is now R5.50 plus the ATM fee which is R2 plus 0.95 percent of the transaction value.
The cost of a mini statement from an ATM has increased by about 14 percent, from R1.75 to R2.
Penalty fees
FNB has substantially increased its penalty fees. For example, you now pay R35 - a 40 percent increase - for each transaction that exceeds your agreed overdraft limit.
You also pay R35 for any transaction that sends your account into the red if you do not have an overdraft facility.
No change
Fees that remain unchanged include cheque service fees (the fee payable on each cheque you issue), electronic account payments, inter-account transfers, external debit orders, stop orders and cheque card transactions.
Cheque account fee options
To reduce your banking costs, you should choose a transaction fee option that suits the way you bank. The three options are:
- Fee Manager, which gives you up to 35 free transactions if you maintain a minimum balance of R6 000 throughout a calendar month.
- Fixed monthly fee, which gives you a set number of transactions for a fixed monthly fee. This costs R45 for six transactions, and R9 per transaction thereafter; R85 for 12 and R8 per transaction thereafter; and R135 for 20 transactions a month and R7 for every transaction thereafter.
- Pay as you use, where you pay for each transaction and service you use each month.
For details, go to FNB's website www.fnb.co.za