Absa has revamped its MoneyBuilder savings account, scrapping the monthly administration fee and offering interest from the first R50 you deposit.
The more you save, the more interest you earn, because the interest rate increases in line with the balance in your account. Interest is calculated daily and capitalised monthly. In the past, interest was only paid on balances in excess of R10 000 in this savings account.
Absa has scrapped the monthly administration fees and introduced a number of free transactions (see costs below), which means no matter how little you have in the account, your savings won't be eroded by administration fees. This has been a problem for people saving small amounts, and has resulted in some people losing all or part of their savings when the bank charges outstripped the interest earned.
Your savings in the MoneyBuilder account are not tied up for any period and there are no restrictions on the amount you can withdraw except for a minimum balance that you must maintain to keep the account open.
You can access your funds at ATMs, Absa branches, via the internet or by using telephone and cellphone banking facilities.
As the MoneyBuilder account is designed to be a savings account, there are some transactions you cannot perform from the account. For example, you cannot pay accounts, third parties, stop orders or debit orders. You also cannot use the MoneyBuilder account as a debit card to pay for purchases or to top up your airtime.
Details about the account are:
How it works:
It is a card-based savings account, which should be used to save money. However, you have 24-hour access to your money should you need to withdraw it.
Who should invest:
Anyone who wants a discretionary savings product, with competitive interest rates and access to their funds at all times. The account is suitable for both small, entry-level savers and large, serious savers, across all ages and income brackets.
Guarantees:
Your capital is guaranteed as long as you don't withdraw it.
Risk level:
Low.
Minimum investment:
A minimum initial investment of R50 is required, and you must maintain a minimum balance of R50. Subsequent deposits must be R50 or more.
Minimum investment term:
There is no minimum or maximum investment term, and there is no limit on withdrawals.
Costs:
There is no monthly administration fee and certain transactions are free. The free transactions apply to those done at an Absa ATM and are:
- Two cash deposits a month;
- Two balance inquires a month;
- Two mini-statements a month;
- Two Absa ATM inter-account transfers a month; and
- Two cash withdrawals a year (from February 2007).
Absa says the account is designed for savings and not for transactions, so these free transactions should be sufficient. However, should you exceed these free transactions, transaction fees will apply.
For example, if you need to deposit cash in your account three times a month, the third transaction will cost R1.05 for the first R100 (or part thereof) and 90 cents for every R100 (or part thereof) thereafter.
ATM cash withdrawals cost R6 for the first R100 (or part thereof) and 90 cents for every R100 (or part thereof) thereafter. After February next year, two cash withdrawals a year will be free, but a third transaction will incur this cost.
Interest paid:
The interest rates apply if you have R50 in the account. Absa says the interest rates for balances above R10 000 are equivalent to those on money market bank accounts. The interest rates are:
- For balances below R9 999 - 3.5 percent;
- For balances between R10 000 and R19 999 - 4.25 percent;
- For balances between R20 000 and R49 999 - 6.65 percent;
- For balances between R50 000 and R99 999 - 6.75 percent; and
- For balances over R100 000 - 7.05 percent.
Commissions:
None.