How banks make billions for little effort
Report exposes the money-making schemes behind bad debts on debit orders
On most bank accounts offered by the big four banks - Absa, First National Bank, Nedbank and Standard Bank - penalty fees charged for an unsuccessful debit order can run into thousands of rand a month, which is why you ought to consider such fees when choosing a bank account, the latest Solidarity Bank Charges Report advises. Debit order instructions can be issued more than once a month by a service provider, which means that even if you have only one debit order, penalties can be levied multiple times in the same month. For example, on any account at Standard Bank, except for the Access Account, the bank will charge you R115 every time a debit-order instruction fails. And if you have an Absa Value Bundle account, you get charged R50 for the first three unsuccessful debit orders. The fee increases to R150 from the fourth event in a 12-month cycle, the report says. Cost analysis The report, compiled by the Solidarity Research Institute, is an analysis of the cost of accounts at six S...
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