Pick n Pay boss slams banks

PICK n Pay chairman Gareth Ackerman has slammed South African bank charges, which he describes as excessive and in many cases, more than double European benchmarks.

Ackerman said increasing numbers of the group’s customers were using credit and debit cards to buy groceries but the interchange fee charged by the banks remained at high levels.

“It adds a disproportionate and unjustified amount to our costs,” Ackerman said.

“Despite an undertaking by the banks to revisit these charges, unjustifiably they remain excessive at 1.48% for credit card transactions and 0.44% for debit cards.”

He said the charges were too high and did not reflect the banks’ costs of operation.

Pick n Pay recently introduced a store card to give its customers a cheaper alternative to bank credit cards. It is also developing its money transfer service with newly licensed TymeDigital and has already registered 200 000 customers.

“We will be working closely with them to provide greater access to financial services for our customers,” Ackerman said.

His comments were made at the release of Pick n Pay’s interim results, which demonstrated the effect of continuing tough economic conditions combined with increasingly robust competition.

The results were also hit by steep once-off costs related to the group’s voluntary severance programme, the first that it has carried out.

Turnover growth in the six months to end-August was up 5.1%, to R39.3-billion. Trading profit advanced 15.8%, to R641.5million. — DDC