Which local bank offers the best rewards?

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Trade union Solidarity has published it’s Bank Charges Report for 2020 which compares the charges of transaction accounts at five South African banks.

Those banks are FNB, Nedbank, Standard Bank, Absa and Capitec.

Looking purely at fees, Capitec beats out its competitors by a large margin in many instances including immediate payment fees, ATM withdrawal fees and transaction fees.

Where Capitec doesn’t compare to its competitors is in its reward programme. To be clear, Capitec does have the Live Better Benefits programme but this only grants discounts for Capitec products and services. If fees are a concern then this might be of interest.

Looking at the other four banks however, the rewards programmes are robust offering discounts or outright purchases at third-party retailers and partners.

These reward programmes are:

  • Absa Rewards
  • Nedbank Greenbacks
  • FNB eBucks
  • Standard Bank Ucount

But which is the best?

In order to find out, Solidarity used the following methodology outlined below:

“For purposes of this calculation we suggest a person who earns R32 000 per month that is paid into the account concerned on a monthly basis, who has a transaction account without overdraft facility, a credit card and a home loan with the bank in question and who follows the bank’s guidelines for saving and rewards as carefully as possible. Where ‘points’ are earned to receive the bank’s marketing material, for example, this will be done. The suggested customer also makes electronic payments rather than visiting a branch. Where the bank suggests, for example, that a debit order be used for making the credit card payments, this will be used. The person also has one online subscription service such as Netflix or Showmax. Because credit cards offer more rewards than debit cards, the imaginary purchases in these calculations will be paid for by credit card, except for the ‘other debit card purchases’ of R2 000.” the union explained.

A breakdown of the rewards that can be earned with the above methodology can be seen below.

Purchase Absa Rewards Nedbank Greenbacks FNB eBucks Standard Bank Ucount
Fuel: R1 600 Sasol BP Engen Caltex
Groceries: R3 000 Food Lover’s Market, Woolworths, Pick n Pay Checkers Shoprite
Health and beauty products: R800 Dis-Chem Clicks Dis-Chem
Other debit card purchases: R2 000
Other credit card purchases: R2 000
Total amount of money back R118.50 R113.57 R463.20 R174.30

It’s very apparent that if you like your money for nothing, FNB is the bank to go for. The sheer amount of money you can earn is impressive and with the ability to buy items, services and even trips through the eBucks store, it really is a valuable offering.

However, depending on how many transactions you do every month, FNB could also be the most expensive of the five banks. At the entry level FNB’s pricing is lower than Standard Bank and Absa. As we move up levels in accounts however, the tide turns and FNB quickly becomes the most expensive offering.

Again, this cost will largely depend on the functionality of the account, the amount of transactions you do and how much money is in the account.

Whether it’s rewards or the cost of banking, this report from Solidarity is an incredibly useful resource and we highly recommend giving it a read if you’re considering switching banks.

You can find the full Bank Charges Report for 2020 in PDF format here.

[Image – CC 0 Pixabay]

Brendyn Lotz

Brendyn Lotz

Brendyn Lotz writes news, reviews, and opinion pieces for Hypertext. His interests include SMEs, innovation on the African continent, cybersecurity, blockchain, games, geek culture and YouTube.