#CheaperThanChicken has South African banks clucking over fees
Companies / 7 September 2018, 7:00pm / Vernon Wessels and Thembisile Dzonzi
JOHANNESBURG - The chickens are coming home to roost for Absa Group Ltd.
The South African lender in July used its separation from Barclays Plc to reboot its image through an advertising campaign using the catchphrase “Africanacity.” The term, it said, is a new word to celebrate the tenacity, ingenuity, positivity and creativity in the way Africans find ways of getting things done.
It didn’t take long for Nando’s Group -- the fast-food chain known for its peri-peri chicken, hot sauces and quirky marketing -- to respond with its own video advertising two pieces of chicken and fries for 84 rand ($5.50) under the title “More South African Flavour.” The clip pokes fun at Absa’s interpretation of the continent by using exaggerated colors and images, including a snippet of two brightly adorned models caressing and kissing a red bottle with the bank’s logo replaced with the words “african nasti.”
On Wednesday, Absa hit back on Twitter, offering a bundle of banking services including access to an overdraft facility, funeral cover and some free transactions for what it said is cheaper than chicken. That set off a series of ripostes from at least two of the Johannesburg-based lender’s main rivals.
For all the cackling over fees, the cheapest bank account in South Africa is available from insurer Old Mutual Plc, which through a joint venture with Bidvest Bank, offers a so-called money account that combines savings and transaction services for 4.50 rand a month. Capitec charges 5.80 rand for its debit card.
South Africa is seeing a rush of new entrants into retail banking, with insurer Discovery Ltd., a local billionaire, and the former head of FirstRand Ltd.’s consumer-lending unit all planning digital offerings.
Absa is South Africa’s worst-performing bank stock this year, declining 13 percent compared with a 5.6 percent drop in the six-member FTSE/JSE Africa Banks Index. Chief Executive Officer Maria Ramos is willing to take on more risk now that London-based Barclays no longer holds a controlling stake as she seeks to double the lender’s market share in the rest of Africa and win back its once-leading position in retail banking.