What's in it for loyal bank customers

Rewards range from fee rebates, debt protection and a homework helpline to insurance cover and roadside assistance, writes Brendan Peacock

If you hold the typical combination of a cheque account and credit card to meet your banking needs, you might be wondering what you get in return for your banking loyalty.

These days you're unlikely to earn much interest on your transactional or credit-account balance. Only certain account products above certain thresholds will earn any interest.

If you really want interest as a reward for holding your money with a bank, you'll have to open a separate savings, call or money-market account. Otherwise, choosing who to bank with can come down to the attractiveness of non-bank offerings from partners in loyalty programmes.

Joanne du Plessis, head of pricing at FNB Core Banking Solutions, says rewards can serve a double function of differentiating a bank's offering from its competitors, as well as encouraging customers to use the channels the bank prefers, which are usually electronic, instead of in-branch.

Arrie Rautenbach, head of retail markets at Absa, saysin many cases the benefits on transactional accounts outweigh interest on positive balances. "For example, we have a rebate banking pricing option where we offer up to R500 in a rebate on banking fees a month if you have a minimum balance of R10000 in your transactional account in the month. If you equate this to interest on positive balances, you would need an average balance of R100000 at 6% a year to match that rebate."

STANDARD BANK

Sugendhree Reddy, director of banking products at Standard Bank, disagrees that what you get back from a bank has to come in the accumulation of "points" of some kind.

"We need to overcome that false perception. Rewards need to be seen in the larger context of what you get back. People want homes, and we are the largest provider of mortgages in South Africa. In 2011, we lent R75-billion, exceeding the entire rest of the market, and that equates to a lot of relationships. We are the only lender in this market really moving ahead. If we can offer better deals and better rates for having consolidated products with us, we can offer packages and facilities in bundles. Those are tangible rewards for banking with us."

Standard Bank's customers also have points options. "We do have the Value Choices programme for discounts, with four categories: trends, family, home and travel." This costs nothing, but for more deals, customers have to join the Value Choices Club at R20 a month.

FNB

FNB's range of benefits for using a cheque card includes up to 15% back on fuel purchases in the form of eBucks, up to 2.5% back in eBucks on qualifying cheque-card spend a month, reduced prices and instalment options on smartphones and tablets for qualifying cheque accounts, certain amounts of free ADSL data and discounted 3G data through FNB Connect. FNB's credit-card benefits include the same fuel rewards, 10 eBucks earned for every R100 spent, travel insurance with every air ticket purchased, automatic debt protection, AA emergency roadside assistance on linked Petro cards and personalised interest rates.

While FNB cheque accounts won't typically earn you interest, the bank offers a Savings Pocket account. You can make transfers into the pocket whenever you want or set up a regular scheduled transfer, and you can also "bank your change" by transferring "leftover cents" into the pocket at each transaction by rounding to the nearest rand and sending the difference to the pocket. Credit interest is paid on the balance, and there are no fees for transferring funds into and out of the pocket. According to FNB, you can earn interest on some credit-card products if you have extra funds in the facility.

To qualify for FNB's rewards, you typically have to use FNB as your main bank, use the correct cards to earn rewards and have regular deposits over a certain threshold into your accounts. Using electronic channels like internet and cellphone banking also helps. You need to register for eBucks, but, once you have, you do not have to register again to receive fuel rewards.

ABSA

Absa's silver and gold cheque account packages, which span individual incomes of R5000 to R25000 a month, typically get you R10000 life cover, certain rebates on vehicle or asset finance or home loans, interest-free overdrafts up to R500 (silver) and R1000 (gold), free secondary and garage cards, credit interest on positive balances and access to Absa Rewards.

Absa's silver and gold credit-card accounts offer free secondary cards - for family members to shop on the same account - at no additional cost, free basic travel insurance, optional balance protection that covers your outstanding balance to a maximum of R100000 in the event of death or permanent disability, and 10% of your outstanding balance paid for four months in the event of retrenchment.

Absa Rewards allows members to earn up to 1% of all qualifying spend back in cash rewards when shopping using a credit, debit or cheque card in retail stores. There are no maximum spending or earning amounts. There are also more than 75 retail partners, at which members can earn up to 10% back in cash rewards. It costs R19.50 a month to be a member.

Aside from cash-back rewards, Absa Rewards offers access to a Dial-a-Discount service on a variety of products and services, a Know-it-All service which can apparently answer just about any question, a Teacher-on-Call service which provides a homework helpline for pupils from grades 1 to 12, access to attorneys via the Legally Yours service, and Breakdown Buddy, roadside assistance for mechanical breakdowns, running out of petrol or needing an emergency hire car (only the contact service is free - you'll need to pay all other costs incurred).

NEDBANK

Nedbank's Graeme Holmes, head of consumer cards, says the Greenbacks rewards programme is available to all cheque and/or credit-card holders at an annual fee of R169. Up to 10 cards can be linked to a Greenbacks account at no extra cost, and Greenbacks will be earned on the accumulated spend of all cards. They don't expire, provided you continue to spend on your card (inactivity for five months will see you forfeit your Greenbacks) and pay your credit-card account on time. "Once the cardholder has completed the seamless online joining process, he or she will earn one Greenbacks point for every R5 of eligible spend, and two Greenbacks for every R5 spent via American Express cheque or credit cards."

Eligible spend excludes cash withdrawals, casino-chip purchases, fuel purchases, finance and other card charges, travellers' cheques or other negotiable instruments, banking fees, garage-card transactions, budget-account instalments, insurance premiums and internet transfers/payments.

Members receive a monthly SMS to notify them of their points balance. Greenbacks accumulate as the client shops and pays with a cheque and/or credit card. Members can spend Greenbacks on flights, gadgets and bank fees or, if feeling charitable, can donate them to Nedbank Affinities.