NEWS ANALYSIS: Price reductions show big banks could have charged less
Standard Bank and First National Bank’s price cuts and airtime benefits are seen as defensive moves as banking competition increases
Standard Bank and First National Bank’s (FNB’s) recent price reductions are clear signs that big banks are willing to sacrifice revenues to protect their turf. In addition to price cuts, they have both added data and airtime benefits to certain products, which will see them technically pay people to bank with them.
After the two launched new low-cost bank accounts for the entry-level market, FNB went a step further by reducing prices for some of its bundle accounts aimed at the middle income segment too. There is no doubt that these are defensive moves in reaction to stiffening banking competition, although both banks would like us to believe otherwise. When it launched its cheapest entry-level bank account MyMo, Standard Bank went as far as saying that it was a product of work that started a decade ago.