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Bank Charges
The Competition Commission released its technical report into bank charges last week.
The Banking Enquiry Panel has been meeting since 2006 and have now released their report. The enquiry was constituted to decide whether a formal enquiry into bank charges was necessary and the report was based on voluntary submissions by the banks, they were not compelled to answer by the powers vested in the Competition Commission and the report is written in the context of voluntary submission by the banks.
The report is ended with this quote "It is not the strongest of the species that survives, nor the most intelligent, but rather the one most adaptable to change".
The report in its recommendations calls for the 'Establishment of a centralised banking fee calculator service. This should provide an accessible facility for consumers to input their own product requirements - with assistance if necessary - and obtain (without cost) an automatic, objective indication of where they could obtain those services and for what prices'.
This calculator already exists and can be found right here at the Justmoney bank fee calculator.
The report basically threatens the banks with a two to three year grace period to implement its recommendations or they will force the banking industry to introduce a 'basic banking product' much like the current Mzansi accounts with 'similar content, capable of being simply and directly compared'.
The enquiry panel will regulate for this if the banks do not voluntarily move towards a more transparent charges model and if they do not introduce more price competition amongst themselves.
Justmoney checks all the bank accounts that are available in SA and it is a complex process, but one that is explicable after a lot of hard work, which is why we can bring you our bank calculator confident that we have done the hard work for you and that you can now click and compare to find the best bank for you. The report can be found here.
The financial news outlets comments on this story are as follows. IOL carried the opinion that charges are too high and that the banks should implement reforms.
The Mail and Guardian put it this way 'The Competition Commission appreciated that industry participants would take the lead in implementing certain reforms, and were encouraged to do so voluntarily'.
Business Day noted that the current system 'let banks sustain prices higher than would prevail in a competitive market'.
At the end of the day the consumer needs to have information in order to make a better decision. Justmoney doesn't believe in shouting, but rather letting you the consumer see for yourself. Compare banks and save with Justmoney, South Africa's online guide to money.