Ironically, given that this country's financial services sector boasts some of the best computer technology in the world – arguably a driver for reducing costs – South African banks are still among the most expensive in the world. 

South Africans pay more to run a current bank account than anyone else in the world – and more than double the global average, according to a global study by international business consultants Capgemini and its research partners, ING and the European Financial Management & Marketing Association.
The World Retail Banking Report 2007, which for the first time includes a snapshot of South Africa, is presented to senior executives of local banks and the financial services industry.
The findings are being tabled by Gemini Consulting, South African associate of the global Capgemini management consulting and IT group, at a time when bank charges come under increasing official scrutiny and the National Credit Act is redefining the rules of credit extension.
Gemini Consulting CEO Stephen Asbury comments: “Timing is ideal from a South African perspective. The report provides a baseline for some telling comparisons with other markets worldwide.
“This is the fourth time Capgemini, ING and EFMA have produced this global overview of retail banking. This year they widened the scope to cover South Africa, Japan, India, Croatia and Romania. This means data on Absa, FNB, Nedbank and Standard is now included. In all, 189 banks are covered.
“The report highlights significant price disparities, but it also gives credit for an improvement in our level of charges this last year.”
The report shows:
* At €196 a year, South African "active" current account holders pay more than double the global average (€77);
* Local active users of lower service transactor accounts pay only about 15% less than the global average for full-service current account customers (€66 versus €77).
* Very active current account holders constitute only 8% of all local bank users, yet pay 28% of all South African bank charges.
* South African active current account holders pay more for payments services than almost all other countries for all banking services in total.
* In real terms, the cost of South African banking services decreased slightly in the last year (down 2,7% in the transactor category and 2,89% for current account holders).
“The report’s findings will be useful to local bankers as some drivers of our higher cost levels are examined. For instance, the data suggests that transaction frequency is not the main cause of high banking costs for current account holders," says Asbury.
“Our national cost-to-income ratio is above average at 65,4%, but we are nowhere near the top and our national interest-to-income ratio is quite low. The data will provide a lot of food for thought.”