How to open a good bank account in tough times

When the economy gets tough most businesses make moves to save their bottom line. Unemployment shoots through the roof as jobs are cut, bonuses evaporate into thin air, promised salary increases are withdrawn and whatever plans you were making are put on hold as you are forced to re-evaluate your priorities. Gen X, Millennials and Gen Zs have lived through 4 major global economic shocks from the 2008 global recession to the most recent global health crisis.

In such times important life choices are either validated or proven to be false hopes. For example, people who saved up and bought a home find they are in a better position than those who did not as rental responsibility evolves into a serious burden. While those who own homes may also find it difficult to seek employment away from their homes while those who rent pick up and move to wherever the opportunity is. While situations may vary from person to person everyone can agree that checking your bank account and finding a monthly deduction to your balance can be bad on a good day but disastrous in tough times. Unfortunately, a majority of bank customers have been going through tough times for a long time.

So what should you look for when opening a bank account for the good times and the tough times?

1. No Ledger Fees/Monthly Fees

Believe it or not there was a time when you would pay a bank just to have a bank account. This fee was known as ledger fee and it was charged monthly and could apply to personal, business and forex accounts. For example, you receive Ksh. 35,000 to your salary account but at the beginning of every month you notice a deduction of Ksh. 400 under monthly account maintenance fees.

In a good month when you receive a travel allowance or a side gig you won’t mind or notice the deducted Ksh. 300 but in a bad month that amount will mentally irritate you. It’s bus fare, KPLC tokens or even small money to send to your shosho for sadaka on Sunday.

While charging monthly account maintenance fees is great business for the bank it can be terrible for you…the customer.This is one of the main reasons customers close their bank accounts.

Choosing a bank which does not charge monthly account maintenance fees could be a good move for personal, retail, commercial and SME clients in both good times and tough times.

2. No Minimum Balance conditions

Instead of imposing a monthly account maintenance fee, some banks will encourage you to keep your bank balance above a certain amount. This behavior is something Gen Xs are familiar with and could be tolerated back when only a handful of banks operated in Kenya. If your balance was below this amount you would be asked to pay the monthly account maintenance fees or in the extreme cases your account was closed for you by the bank.

As you choose a bank, especially for your business, investments, savings and premium transactions make sure you read the fine print and ensure there is no minimum balance or ledger fees.

Find a bank that works for you without exploiting your hard earned money.

3. Low transaction costs

Let’s be honest, at the end of the day a bank is a business and it has to make money. One way banks make money is through transaction costs charged when you transfer money, make payments, clear cheques, use an AT card or process loans. However, not all banks charge the same transaction costs for each service.

Find a bank that has relatively low transaction costs and where possible a threshold for zero transactions on the accounts that matter most to you. NCBA Bank has rolled out a number of changes for existing and new accounts including no monthly account maintenance fees for business, salary and platinum accounts.

NCBA is also one of the banks that does not apply minimum balance allowing you to open an account that suits your personal and business needs. This makes it a true ‘no-ledger’ bank which makes it a bank you should consider when choosing your bank.

Other things to consider are additional services and products such as digital and online banking to suit both on the go and regular lifestyles. NCBA Bank also has tailor-made business solutions for SME, commercial and asset financing which makes no monthly maintenance fees an added bonus regardless of the size of your operation be it personal, salary, SME or business.

A good bank looks at its bottom line, a great bank works for its customer’s bottom line. With the new changes NCBAshows its looking out for you…the customer.