As the festive season has kicked off in earnest and consumers spend more, FNB on Monday warned that approximately 56 percent of middle income consumers in South Africa spend all their monthly income in five days or less after receiving it.
This is according to data from FNB’s Retail segment, which categorises middle income consumers as those who earn a gross monthly income of between R7 000 up to R60 000.
Raj Makanjee, chief executive of FNB Retail, said that for many consumers it was not only a matter of living from one salary payment to another, the reality is that their monthly salary just does not last for 30 days.
Makanjee encouraged consumers to exercise financial discipline, saying that financial discipline was not dependent on having greater income but requires deliberate steps.
“These consumers tend to struggle with money management, with the shortfall leading to sacrifices in important areas such as having back up or emergency saving that can be used to pay for unforeseen expenses. High spending and limited savings cause consumers to rely on credit to get through the month, making them more vulnerable to be caught in a debt trap,” Makanjee said.
Christoph Nieuwoudt, chief executive of FNB Consumer, said more than half of consumers miss at least one debit order over a 12-month period, indicating the pressure consumers are under.
“For almost 40 percent of such customers, debt repayments make up more than half of their take-home-pay, which we consider to be very high. The main driver of this is large numbers of microlender loans and store cards that consumers take up. The ideal scenario for a consumer is to have one provider who gives them a transactional account and the right type of credit when needed,” Nieuwoudt said.
The bank said said it had also seen that 30 percent of middle income consumers who are saving, save for emergencies and at least one other longer-term goal.
Source: The Citizen
FNB has become the first bank in South Africa to offer consumers an innovation that allows them to tap bank cards and enter a personal identification number (PIN) to perform a transaction without inserting the cards into automated teller machines (ATMs).
The bank estimates that the “Tap and PIN” function will reduce the time it takes to make a withdrawal by up to 20 seconds and protect its customers against card skimming devices. The functionality is currently available across 100 FNB ATMs and the bank said more would be upgraded during 2019.
The new product is a major step in the bank’s plans to continuously improve the convenience and safety of its banking ecosystem, said FNB Retail chief executive Raj Makanjee.
“In the last three years, consumers have processed approximately R1 billion worth of contactless payments from 5 million transactions on FNB issued credit and debit cards alone,” Makanjee said.
“The frequency of use by consumers has grown by between 100% and 300% on our credit and debit cards respectively, highlighting the confidence of our customers in adopting new and secure payment methods. Having started issuing contactless cards three years ago, we now have over 8.5 million contactless-enabled debit and credit cards in the hands of consumers.”
Makanjee said contactless payments offered substantial benefits in an era where consumers and retailers wanted to avoid long queues.
If your bank card gets stolen and you cancel it, this does not automatically mean that all payments from it will be blocked.
This was the case when two FNB customers contacted MyBroadband about their frustrating experiences with the bank.
The customers both had their FNB bank cards stolen in different scenarios – and both contacted FNB to have their cards cancelled.
Despite cancelling the cards, both users noted small payments still going off their bank accounts via card transactions.
The charges were toll gate fees.
In one case, the customer reportedly asked FNB why the cancelled card could still make transactions. He said he was told by FNB that he would have to blacklist the card, on top of cancelling it, to stop the transactions.
In the other case, the customer stated that all he could do was get a refund for the toll gate fees.
This customer subsequently contacted the toll gates where his card was being used to ask them to block transactions on it.
He also managed to obtain an image of the vehicle using his stolen card – it was a white Toyota minibus taxi with a Gauteng registration.
MyBroadband contacted FNB for feedback on the matter, and the bank confirmed that the bank cards were cancelled as described above.
“Unfortunately, due to toll gate merchants operating in an offline environment, this prevents them from obtaining authorisation from the bank for transactions of this nature. As a result, additional transactions were posted,” said FNB.
“The customer will not incur any loss resulting from fraud in this scenario.”
FNB was asked what a bank customer should do to ensure their cancelled card is not used to make these types of transactions, but the bank did not provide feedback.
According to PASA (Payments Association of South Africa) documents, lost and stolen card fraud at toll gates has been highlighted as a significant concern in recent years.
“Although toll card transactions are a card present transaction, fast throughput of vehicles is important and transactions are thus processed in an offline and delayed manner – cleared in batch,” states PASA.
“Importantly, unlike any other offline card present card transactions, toll gate transactions are not verified by the cardholder in any way.”
It added that while toll gate transactions are checked against the “Hot Card” file, this “only contains a limited number of all lost and stolen card details”.
Source: The Citizen
The EFF has criticised South Africa’s major banks, calling them opportunistic and hypocritical “in their testimony given to the state capture inquiry”.
Standard Bank’s retired head of legal testified at the inquiry on Monday giving reasons that led the bank deciding to close the business accounts of the controversial Gupta family.
Former FirstRand Group – which First National Bank (FNB) is a division of – chief executive officer (CEO) Johan Burger is testifying at the commission today.
“These banks were very happy to do business with the Guptas until the unceremonious December 2015 removal of Nhlanhla Nene as finance minister when South African stocks were severely devalued,” the EFF said in a statement.
The red berets added that by the time of Nene’s axing, the Guptas and former president Jacob Zuma – who are commonly referred to as the Zuptas – were already carrying out corrupt activities “facilitated by the very same banks”.
The EFF said: “It is impossible that the banks only started to notice the suspicious transactions of the Guptas and their companies in 2016 as they now want us to believe.
“The truth is that these banks colluded in the looting of the country for as long as it was feeding into their profit maximisation motives and greed. These are the only driving forces behind the commercial banks. For them, it’s profit before people and the country.”
The party said it hopes the chair of the commission Deputy Chief Justice Raymond Zondo would not be fooled by the testimony of the banks.
“We call on the South African Reserve Bank (Sarb) and the Financial Intelligence Centre to launch a separate probe into the complicity of South African banks in the Gupta state capture and why they turned a blind eye towards an obviously suspicious transactions before 2016 and to hold them accountable for their part in state capture,” the EFF said.
The party added that if the Sarb fails to institute such a probe the party would take it upon itself to initiate a parliamentary probe into the matter.
Meanwhile, Burger testified on Tuesday that FNB had closed the accounts of the Guptas due to associated reputational and business risks.
On Monday 7 May 2018 First National Bank became the first bank in South Africa to introduce a mini-ATM that uses biometrics, as a means of validation for consumers.
The device functions as a self-service kiosk from which customers can make withdrawals, transfers, and payments, view statements, purchase airtime and electricity and perform card cancellations. It also people to open new accounts by reading a consumer’s thumb print.
“The TouchPoint validates a customer’s identity by scanning a fingerprint placed on the biometric reader and it can detect false fingerprints to prevent fraud,” said Lee-Anne van Zyl, CEO of FNB Points of Presence.
“The identity of the customer is then verified with the department of home affairs to ensure the self-service account opening complies with the relevant laws.”
FNB said the device had been successfully piloted in Gauteng province since November 2017 and the bank aimed to place the devices in branches, community retailers in townships and rural areas across South Africa.
“The introduction of biometric validation on self-service devices is an important step to making banking much more accessible to South African communities,” said van Zyl.
“This is a continuation of our journey to broaden financial inclusion.”
Source: Supermarket & Retailer
By Thandi Skade for Destiny Connect
FNB has announced the launch eWallet eXtra, a mobile offering that enables unbanked South Africans to open a bank account remotely via their cellphones.
The service, which is scheduled for launch in June, will enable consumers to open a bank account without ever having to walk into a branch and without having to submit any paperwork.
The entire process of opening an account is done digitally and the only details you would have to input on your phone is your name, surname and ID number.
“eWallet eXtra will enable users to send or receive deposits from individuals and other banks, store funds for an unlimited period, pay accounts and also buy prepaid products like airtime, data and electricity. Users can also on send to other recipients and withdraw at any FNB ATM or at tills across participating Spar stores, which also allow for over-the-counter purchases. The daily spend limit is R3 000,” says Gugu Zikhali, FNB Head of Transaction Products: Mass Market.
Account holders will also be able to check their bank account balance and transaction history and similar to any bank account, you’ll need to generate a PIN in order to access the account.
The idea was born out of the need to bring the gap between banked and unbanked consumers, while also servicing the needs of irregular income earners like season workers who don’t always necessarily need all the services offered with a traditional bank account.
“This is why we have integrated some eWallet functionality into the eWallet eXtra mobile bank account. After an in-depth assessment of eWallet user patterns, we realised that in excess of one million users have been effectively using it as a bank account despite the fact that the solution was designed as a remittance service,” says Pieter Woodhatch, FNB Easy CEO.
There are no monthly banking fees attached to eWallet eXtra and it doesn’t accept debit orders.
“We believe that eWallet eXtra is the ideal solution to address this important gap and based on the analysis of our customer base and research on financial inclusion, we estimate the size of this market to be in excess of 11 million,” he adds.
You need to be over the age of 16 to use the offering.
Image credit: Memeburn
The vast majority of First National Bank’s (FNB’s) customer interactions are via digital platforms, with only 1.2% still happening face-to-face in branches.
This is according to Christoph Nieuwoudt, FNB consumer segment CEO, who says in 2016, FNB customers had over 10 billion interactions with the bank, of which only 120 million were face-to-face.
The bank says roughly 8.5 billion (85%) of interactions were purely through digital channels and the rest via point-of-sale (card swipes or online purchases) and ATM transactions.
“The number of FNB customer interactions has tripled since 2010, growing at more than 20% per annum every year, based on the growth in digital channels. Meanwhile, at branches, customers are making significant use of in-branch digital zones,” adds Nieuwoudt.
“One thing we can all agree on is that digital progress is inevitable.”
He says the implications of the use of technology by society are immensely profound, with terms such as “The Second Machine Age” or the “Fourth Industrial Revolution” being used to give this evolution a name.
“The reasons for the growth and migration of volumes to digital are obvious as almost every customer knows they can do basically any payment transaction, account or card service function and get most products…via the FNB app, online or cellphone banking,” he says.
However, Nieuwoudt says this does not mean branches will go out of business. He notes branches and branch personnel are no less critical than before, but their role has changed from performing transactions to re-focusing on sales and advising customers on how to bank.
“In spite of the powerful digital technology, today the bulk of banking consumers still want to talk to someone when opening a new account and even for most product categories.
“Additionally, consumers often need help with the new technology, even just to get going and start using it.
“In most cases, branches can be much smaller, but with more room for digital zones and self-service devices such as ATMs and ADTs (deposit-taking machines). This journey is not unique to banking – virtually every sales or service business is or will be going through some elements of digital transformation.”
Nieuwoudt also says that today only a very small percentage of credit decisions are made by people – rather statistical models are used to make fully automated decisions instantly at low cost and with accuracy not achievable by a person.
“This means your risk profile and behaviour determines your loan size and pricing. Importantly, technology has helped reduce fraud loss rates for card and digital transactions,” concludes Nieuwoudt.
Source: IT Web
FNB is warning customers about a new scam which involves them receiving an e-mail stating their online banking access will be disabled or deactivated.
“In an attempt to obtain your personal details, you will be requested to select a link in the email to confirm that you did not request your account to be deactivated,” said FNB.
July 2015 retail trade sales expanded 3,3% year-on-year, but growth slowed from an upwardly revised 3,8% in June, and totalled 3% year-to-date.
FNB’s market-leading Banking App is now active on more than 1-million smart devices.