Banking and wealth management group Investec has launched its first overnight business bank account, in what a Reuters article on Wednesday July 14 calls, “an effort to attract customers from more than 100,000 businesses in average height in South Africa”.
The company said Wednesday that it offers the account to businesses that are at least three years old and have an annual turnover of 30 million rand, or $2.1 million. These firms may consider themselves “too small for a specialist lender like Investec” in a market dominated by South Africa’s four largest banks, according to the Reuters report.
Investec offers services that include cash management, foreign exchange and loans. The new account will cover day-to-day needs, such as withdrawals and deposits, allowing it to serve as the primary banker for new customers.
Dhiren Mansingh, head of corporate transaction banking, told Reuters the move would generate new business as customers typically turn to their primary bank first for products.
“A transactional offer is the glue for a client,” Mansingh said. “We believe this can be a significant growth opportunity from a revenue and customer acquisition perspective.”
More than 100,000 companies meet Investec’s turnover threshold criteria, based on the company’s research estimates. Mansingh said the company wants to see 5,000 to 8,000 companies meet its other criteria using its full product line within two to three years.
PYMNTS sat down last year with John Elliott, head of open banking at Investec, to discuss the benefits of open banking. One of the topics discussed during our interview was the challenge of gaining consumer trust.
“The biggest challenge for open banking in the short to medium term will be consumer acceptance,” Elliott said. “It’s even easier to use a card and in some ways it’s safer because you own the chargeback. If you don’t like a transaction, you can always reject it and take no responsibility for it.
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