Bank Zero is a latecomer to the South African digital banking market, but it is confident its value proposition will be good enough to convince new customers to sign up.
Bank Zero was first unveiled in January 2018 by founders Michael Jordaan and Yatin Narsai after it was granted a mutual banking licence by the South African Reserve Bank.
At the time Jordaan said Bank Zero would be a smartphone app-driven bank that “offers added control and transparency”.
The new bank planned to launch its first banking products before the end of 2018, but this did not happen.
The public launched has been delayed numerous times and a gradual move from its current beta testing to a public launch is now only set to happen later this year.
Bank Zero did, however, unveil its pricing guide for individual and business customers in October 2020, which gives an overview of its value proposition.
There are no monthly fees, no fees on payments, no payment for statements, and no costs for buying prepaid data, airtime, and electricity.
Bank Zero will charge R9 per R1,000 for cash withdrawals at ATMs and R2 to draw cash at Point of Sale.
Bank Zero only offers one account type which will be attractive to business customers who typically pay higher fees than retail customers.
While the low fee structure will appeal to some South Africans, it may not be enough to convince large numbers to jump ship from their current banks.
Bank Zero’s delayed launch also means many competitors were able to respond with their own low-cost banking platforms.
Discovery Bank officially launched in November 2018 and began onboarding new clients in earnest from July 2019.
Discovery Bank is a digital-first offering which is built around behavioural economics and leverages a similar rewards model to the company’s Vitality programme.
Not to be outdone, FNB launched its Easy Zero digital banking account with no monthly fee in November 2019.
FNB Easy Zero provides customers with a branded FNB bank card which can be used for free swipes and offers “cost-effective” fees for transactions and ATM withdrawals.
What Bank Zero is planning to attract customers
Bank Zero CEO Yatin Narsai told MyBroadband they will only disclose their full value proposition later this month.
He did, however, provide a few key aspects of their product offering. These include:
- Patented card technology which offers greater security and convenience.
- Simplified ultra-low pricing for businesses and individuals. “Our solution also brings huge relief to businesses,” Narsai said.
- Advanced payments technology like mandates processing for businesses.
- Integration with Xero Accounting for businesses.
- Unique features that connect people in line with modern social trends.
- Powerful and cost-effective QR payments which enable micro payments without the need to share account and cellular details.
- All customers get statements for free.
“There’s even more to follow. The big challenge was to package all this in a manner that’s easy and intuitive to customers,” said Narsai.
Bank Zero pricing
Bank Zero only offers one account type “because it doesn’t believe in the practice of luring customers in with an entry-level account that has limited functionality”.
The same pricing structure is offered across individual and business banking. It currently supports (Pty) Ltd’s, CCs, and Sole Proprietors, with trusts and partnerships to be included at a later date.
|Bank Zero pricing|
|Monthly fee on account||R0|
|Minimum balance in any account||R0|
|Notifications on all banking activities||R0|
|Open more savings or notice accounts||R0|
|Transfer money between own accounts||R0|
|Pay recipient at another bank||R0|
|Pay recipient at Bank Zero||R0|
|Pay recipient at Bank Zero using their QR code||R0|
|Pay by debit order||R0|
|Pay by card||R0|
|Buy prepaid data, airtime, electricity, etc||R0|
|Send proof of payment via email||R0|
|Receive monthly statement via email or download||R0|
|Request previous statements within 3 months||R0|
|Request account confirmation level||R0|
|Set up new business profile||R0|
|SendMoney to Bank Zero recipient using their cell number (up to R3,000)||R0|
|SendMoney to self (up to R3,000): cardless cash at Checkers, Shoprite, Usave||R8.50|
|SendMoney to someone not at Bank Zero (max R3,000): cash out at at Checkers, Shoprite, Usave||R8.50|
|Draw cash at ATM||R9 per R1,000|
|Draw cash at Point of Sale (Pick n Pay, Spar, Checkers, Shoprite)||R2|
|Balance enquiry at Point of Sale or ATM||R2|
|Nuisance fees – Insufficient funds, exceeding card limits, card set to lock or ATM off, locked after 3 wrong pins, Using new card before activation, using old uncancelled card||R2|
|Card personalisation with delivery to a Clicks store||R79|
|Card personalisation with delivery to a street address (main/regional)||R139/R179|
|Send proof of payment via SMS||R1.50|
|Open additional check account on profile||R100|
|Request statements older than 3 months||R10 per statement|
|Receive money via a Bank Zero QR code||0.5% of amount|
|Dispute or stop debit order||R8|
|Dispute card transaction (ie chargeback)||R30|
|No transactions on check account for more than 6 months||R5 per month|