When selecting a bank account for your child, first consider what they will be using it for and then look for one with the best pricing structure.
A young child who is mostly saving will want an account with a high interest rate, while an older child who may be doing regular transactions would look for an account that has the most cost-effective fees.
These are accounts offered by the banks for children up to the age of 18.
Absa
The Absa Mega U Youth account has no monthly admin fee and an interest rate of 0.15%.
Free transactions include:
- Debit-card purchases
- Cash deposits at a branch or ATM for amounts up to R500
It costs R4.20 per ATM withdrawal and R3.95 when drawing cash at a retailer (cash back).
FNB
The FNB Fluid account has no monthly fee is and earns no interest.
Free transactions include:
- All card purchases and cash withdrawals (cash back) at retailers Checkers, Shoprite and PicknPay
- Two free debit transactions each month
For a fixed fee of R23 per month, your child gets a bundle of additional transactions, including six FNB ATM withdrawals. If however your child maintains a balance of R500 then this fee is waived – though keeping that balance may be quite a challenge for most teenagers.
FNB MyFirstSavings is aimed at building up savings, has no monthly or transactional fees and pays interest of 5% on balances under R20Â 000. Your child is able to withdraw only 25% of their money (minimum deposit R100) without notice once a month and they have to provide a 45-day notice period to access the remaining funds.
Nedbank
Nedbank 4Me is a current account with no monthly management fee and an interest rate of 2.5%.
Free transactions include:
- Two cash withdrawals at a Nedbank ATM
- First R100 deposit is free
It costs R2.25 per card purchase.
Nedbank Dezign Student provides for more transactions and may be better suited to a teenager. It is available for fulltime students aged 16 to 26.
The monthly fee is R18, and the following transactions are free:
- Any Nedbank ATM withdrawal
- All card purchases
- Airtime top-ups
- ‎Withdrawals at tillpoints
Nedbank Save4me is for savings only. It has no monthly admin fee and an interest rate of 4.5%. Withdrawals from the account require 24 hours’ notice, and Nedbank pays in R2 for every four credits to the account.
Standard Bank
The (sum)1 account for under 16s has no monthly management fee and pays no interest.
Free transactions include:
- Three Standard Bank ATM cash withdrawals
- Five electronic debit transactions per month, which include card purchases, cash back, electronic fund transfers and inter-account transfers. This does not include debit orders however.
- Four ATM cash deposits and one branch cash deposit, although they do charge to deposit cheques
Capitec
Capitec does not provide a dedicated child’s bank account but a child could open a Global One account which has a R5 monthly fee. The interest rate is 4.4% which means that your child would have to hold a balance of just over R1 000 for the interest earned to offset the monthly account fee.
- Free card purchases
- R1.05 to withdraw cash at a retailer such as Checkers, PicknPay and Pep
- R4.60 to withdraw cash at a Capitec ATM
Checklist: What to remember when opening an account
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This article first appeared in City Press
I believe the Nedbank 4me, as well as the Capitec Global Account, are the best options for starters.
Many of the banks now offer children accounts with no monthly fee. that is the one challenge with Capitec Global as it has a monthly fee. My son has just opened one with TymeBank as it has no monthly fees and really cheap
Hi there, TymeBank doesn’t open account for kids younger than 16. So I presume you child is older than 16?
yes he is. I’ve also noticed that some banks do not allow you to open a bank account for a child under 16 unless you bank with them
I had a terrible experience with Nedbank 4me. When we opened the accounts for my kids they never told us that you had to do a minimum of 1 transaction on the account a month. A couple of months later when I tried to transfer money to their accounts I saw that they had been frozen. So much red tape to try sort out, not to mention the ridiculous amount of time we spent in the bank just opening them in the first place.
I also had quite a battle with Nedbank – not sure their systems are fully integrated on the children’s accounts. We had quite a battle with my son’s UnLocked Nedbank account, but now it is working and the app is good.