The ABSA savings account addresses a significant challenge faced by many South Africans: setting up a savings account. A 2018 report from MyTreasure, a finance group, revealed that only 15% of working South Africans have a savings account. This translates to just 3% of the nation’s households actually saving money.
Our research has shown that people often refrain from saving because they believe they need a large sum of money to get started. To dispel this misconception, we’ve reviewed various South African savings accounts to provide insights into saving money. In this article, we’ll delve into the ABSA TruSave savings account, which allows individuals to open an account with as little as R50.
Application
When applying you will need:
- Your South African ID
- Proof of residence (not older than three months)
What it offers:
Cash deposits and withdrawals ABSA Savings Account
Each month, you get two free ATM cash deposits. This function encourages people earning on a monthly or fortnightly basis to top up their savings account for free at least twice every month.
However, you can still make frequent monthly cash deposits at a competitive fee. At the beginning of 2020, ABSA reduced withdrawal fees (for native ATMs), deposits, and monthly account fees, attempting to counter high competition in the South African banking market.
There is also flexible access to your account since you do not have to serve a notice period just to make a withdrawal. Each year, ABSA gives you 2 free ATM withdrawals.
Additionally, you can choose to save money by reverting to using the ABSA Digital channels where applicable.
Interest earned
Interest is calculated on your daily balance and paid to you monthly. The interest rate on your account is variable and linked to market conditions and our prime lending rate.
On average, the interest rates range from 0.70% for balances from R50 to 3.5% on large account balances. The interest rates vary depending on the account balances and the market conditions.
Competitive advantages of ABSA TruSave Savings Account
Everyone can start saving
Considering the percentage of savings accounts current holders in South Africa, we surely need to encourage more people to start saving. The ABSA TruSave savings account can be opened with as little as R50, which should encourage people to start saving from the little they might spare.
The effects of the COVID-19 lockdown have further revealed the importance of a savings account to mitigate unexpected events. Some were heavily affected by losing their incomes. Hence allowing people to save small amounts is a great way to encourage smarter money management.
Access to cash
To give you control over your money, the TruSave savings account allows you to make anytime withdrawals without a notice period.
One of the reasons people save is to be able to access funds during their rainy days. Hence an easily accessible savings account may save you from taking a loan.
Free monthly and yearly transactions
If you make limited transactions, you can actually manage your savings account without having to pay anything. Each month, your TruSave savings account allows you to:
- Make two free Absa ATM cash deposits
- Two free Absa ATM mini-statements
- And two free Absa ATM balance enquiries
There are also two free Absa ATM cash withdrawals each year.
Competitive Disadvantages of the Absa TruSave Savings Account
Interest rates are not pleasing
A savings account offering you less than 4% interest per annum is not actually growing the value of your money. Rather, the account is merely keeping pace with inflation.
Conclusion
The Absa TruSave savings account is one of the best savings accounts and it is a good starting point on your road to saving. It will allow you to put together a savings plan from the small amounts you didn’t assume could be saved.
However, as your account grows, you might consider opening the Absa tax-free savings account to earn better interest and avoid taxes on interest earned. Or else you can move your savings to one of their “term deposit” products for better interest.
