Payments – Collectively Costing South Africans Millions

for every RTC transaction.

The potential revenue from these transactions is not insignificant, either

PASApreviously said banks process as many as 49 million RTC payments in a calendar year At the low-end average across SouthAfrica's big five banks in 2023, this would put the money received by all banks in RTC fees at R439 million for the year. Banks would receive about R1.6 billion per year in RTC fees at the high-end average.

Banks have previously denied that these fees exist to make money They claim they are forced to charge premium rates for immediate transactions due to operational requirements and fraud prevention measures.

However, none can seem to agree on how much these operational requirements should cost the customer

Banks are 'forced' to charge premium rates for RTC

Historically, Capitec offered the cheapest RTC services in South Africa at R7.50.ACapitec spokesperson previously said they decided to keep these fees low to remove risks associated with carrying cash.

"We also believe we have a role to play in the furthering of the country's digital economy through this affordable fee, which makes it an accessible payment option for millions of South Africans," the spokesperson said.

Absa, which charges R10 for RTC payments under R1,000, and R49 for those above, is still the most restrictive and expensive of the big five banks.

In 2021, anAbsa spokesperson told Business Insider SAthat immediate inter-bank payment fees "cover the costs associated with inter-bank real-time

Here's how SouthAfrican banks stack up on immediate payment fees in 2023: clearing, as well as the additional fraud prevention measures we have implemented on this transaction type."

Some banks also argued that although they charge a premium for RTC payments, they have introduced alternative real-time payment options at lower costs. Yet the surge in popularity of immediate payments suggests they're more popular than other methods or solutions.

Immediate payment fee changes in 2023

Most SouthAfrican banks haven't changed their fee structures for immediate payments in 2023.

The most significant policy change comes from FNB, which has adopted a flat rate fee of R7. Previously, FNB's RTC fee varied between R8 and R45, depending on the customer's account type.

FNB's drop is now 50c cheaper than Capitec's R7.50 – 2021's lowest RTC fee – and is in line withTymeBank's flat R7 fee.

Discovery Bank also offers a flat fee, which varies according to the bank account. Its entry-level savings account requires customers to pay R35 for this transaction, while mid-tier transaction accounts charge R10. Premium Discovery Bank accounts include these transactions free in bundles.

African Bank charges R10 for an immediate transfer - a number not tracked when Business Insider SAfirst conducted this research in 2021.

Absa, Standard Bank, and Nedbank have not changed their immediate payment fees since 2021 and still charge a premium for these transactions.

Standard Bank has, however, lowered the limit for their premium rate – customers now pay R50 for immediate payments above R2,000, whereas previously, this rate applied for transactions above R3,000.Business Insider