An Inter-Country Survey of the Relative Costs of Bank Accounts

This report examines the access of low-income individuals to transactional banking products in South Africa as compared to Brazil, India, Kenya, Malaysia, Mexico and Nigeria. The report analyzes:

• Relative costs of services;
• Value customers receive in terms of availability;
• Functionality of the products and services provided.

The report:

• Provides general information on the countries compared in the study;
• Generates measures of the potential demand for transactional banking services in these countries;
• Compares these measures with the level of actual demand measured by the bank accounts in each country;
• Considers the characteristics of the financial sector, and the factors affecting the supply of transactional banking services in each country.

The report finds that:

• Different factors determine the access to financial services;
• User cost comparisons need to take into account many factors, including product functionality or user value;
• In countries with expensive products, the uptake of banking services tended to be lower than potential demand;
• Development of electronic banking increases functionality.

The report compares various features of the banking environment of South Africa with those of other countries. It concludes that if prices are to guide consumer behavior, the banks will have to commit to consumer education and will have to recommend appropriate products for their customers.