Cheapest Credit Card in South Africa
Monday, July 31, 2006
Excerpt: VIRGIN founder Richard Branson has launched an assault on the second high-fee industry in SA within a week ? ploughing R120m into launching the cheapest credit card in SA yesterday and setting his sights on a full-blown financial services business.
This follows Virgin?s launch at the weekend of SA?s fourth cellular company.
Virgin?s aggressive move into the banking and cellular sectors promises to bring competition into these perceived ?fat cat? markets, which could help bring down prices and boost service.
At the launch of Virgin Money in Johannesburg yesterday, Branson said banking was, like telecommunications, a corner of the South African economy where consumers were ?being fleeced? by the four biggest banks.
Virgin?s entry into the South African banking and cellular market in the past week is based on undercutting incumbents, and comes at a time when those industries are under unprecedented pressure over fees.
The Competition Commission, for one, has announced a public inquiry into bank fees and the national payments system.
The Virgin Money credit card is significantly cheaper than cards offered by Nedbank, Standard Bank, First National Bank or Absa, with no annual card fees, lower interest rates on credit advances, and lower fees at ATMs.
As with his Virgin Mobile partnership with Cell-C, Branson is partnering a bank to launch Virgin Money, in this case Absa, which will also put in R120m.
