Cheapest bank accounts in South Africa

Bank Zero offers the cheapest low-cost banking service in South Africa, a MyBroadband analysis using a basket of transactions shows.

South Africa’s major traditional and digital banks all offer entry-level, low-cost accounts for those who prefer a pay-as-you-transact model to products with larger monthly administration fees.

Absa, Capitec, FNB, Standard Bank, Nedbank, TymeBank, and Bank Zero have bank accounts with monthly fees of less than R10.

MyBroadband compared the transaction fees on these entry-level bank accounts.

We used a basket of monthly transactions to calculate a total cost and determine a winner. The basket includes the following transactions:

• The monthly account fee
• One cash deposit of R1,000
• Two cash withdrawals of R1,000 at own bank
• One cash withdrawal of R1,000 at another bank
• Three external debit orders
• Three payments to other banks
• Two prepaid airtime purchases
• Two prepaid electricity purchases
• 20 SMS notifications

South Africa’s digital banks offer significant savings over the country’s traditional banks, provided users are prepared to sacrifice certain benefits, such as the ability to make deposits and withdrawals at a branch.

These upstart banks only allow deposits at supported point-of-sales tills and other banks’ ATMs.

Regarding the country’s traditional banks, Standard Bank came out on top. However, it should be noted that it was by a small margin, with only R1.55 separating its total basket value from that of FNB’s Easy PayU account.

The basket comparison across the five banks’ accounts is summarised in the chart below.

Bank Zero and TymeBank’s PoS deposit fees are retailer dependent. We used Shoprite’s fee of R19.95 for the analysis.

Bank Zero’s basket came out cheapest with a total cost of R32.95, while the other digital bank compared — TymeBank — was the next-most affordable at R41.95.

Standard Bank’s entry-level account’s total cost comes in at R63.30, with FNB’s Easy PayU and Capitec’s Global One following closely at R64.85 and R72.00, respectively.

Standard Bank’s MyMo PayT account carries one of the higher administration fees of the lot, but its lower withdrawal fees for other banks’ ATMs helped it gain the top spot for the major banks.

FNB’s Easy PayU account likely would have been cheaper than Standard Bank if it charged less for prepaid electricity recharges. It charges R2.70 per purchase, while Standard Bank charges R1.50.

Nedbank’s pay-as-you-use account, while not charging any administration fee, bills more for general transactions, bringing the basket cost up to R105.10.

Absa’s Transact account worked out to be the most expensive at R108.90. This was primarily due to higher SMS notification, deposit, and withdrawal costs.

The banking fees for entry-level accounts from several South African banks are compared in the table below.

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