Last year, South Africans ranked their best and worst banks. 

This ranking looked at the entry-level accounts that most banks have been focusing on as they try to increase their client base.

But, there’s another side to the banking world that we’re all aware of, but don’t really give much thought, because it doesn’t affect most people.

You know that list of the richest people in South Africa? They’ve got to keep their billions somewhere, and it probably isn’t going to be in your standard entry-level bank account.

Over to BusinessTech:

While a battle rages on in entry-level banking, South Africa’s major retail banks have not shifted their attention away from the higher-end of the market – with new entrant, Discovery, banking on its behavioural banking model to win over the elites.

Discovery Bank is wooing rich folks with Discovery Purple, an account with the highest barrier to entry to qualify among all the banks that target this market.

According to the Discovery Purple brochure, to qualify for an account, a prospective card holder would need to earn at least R2.5 million a year (over R200,000 a month) to take advantage of the major discounts and “bespoke account structure” on offer.

Well, if it’s “bespoke”, who are we to argue? As for the other banks, Investec has no strict salary requirement but has been open about the fact that it almost exclusively targets people with a high net worth.

Nedbank and FNB offer Private Wealth offerings, with salary requirements sitting at R1,5 million. Alternately, FNB would like you to have a net asset value of R15 million, please and thank you.

RMB Private Banking – closely tied to FNB as part of the FirstRand Group – has the same entry requirements as FNB’s tier 2 private account (Private Banking), requiring an annual salary of at least R750,000, or the same net asset value of R15 million.

R750,000 is the same salary requirement for Absa’s Private Banking account – while Standard Bank’s Signature Banking account requires R1.1 million.

This handy table breaks it down bank by bank:

Source: BusinessTech

As I’m sure you’ve figured out by now, very few people qualify for these particular banking options.

According to the latest tax statistics from SARS, of the 4.9 million taxpayers assessed last year, only 365,800 of them earn over R750,000 a year.

Even fewer fall into the higher income brackets, with around 148,000 qualifying for the R1 million limit at Standard Bank, and around 34,000 making the cut for Discovery Purple’s limit of R2.5 million.

It might interest you to know that even if you fall into South Africa’s richest 10% you probably wouldn’t qualify for a Private Wealth account.

On we soldier, through the recession.

[source:businesstech]