Investec’s multi-currency move – Moneyweb

Investec has introduced a new feature to its private bank accounts, allowing users to transact in four currencies with a single account and credit card.

With the new functionality, private banking clients can open and fund “pockets” for dollars, pounds and euros while keeping their existing rand account.

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This simplifies international transactions for people who travel abroad frequently, or clients who are managing international expenses, says Itumeleng Merafe, head of Investec Private Bank.

“The feature means there’s no longer a need for separate cards for the various currencies. The Investec card will be enabled with all these currencies,” he notes.

Itumeleng Merafe, head of Investec Private Bank. Image: Supplied

Exchange controls

Although the funds remain in South Africa, they are viewed as offshore from a regulatory perspective, eliminating unnecessary administrative and cost burdens.

“We didn’t want to create something seamless on the platform, but that necessitates paperwork later.”

(South Africans have a R1 million single discretionary allowance annually for transferring funds overseas.)

Read: Seize the opportunity: Why your R1m discretionary allowance matters

Clients can fund their currency pockets in seconds and mitigate foreign exchange volatility, Merafe says.

Built into the feature is an alert that keeps clients in the know regarding how much of their discretionary allowance has been spent through Investec.

Forex fees

There will be no fees for clients opening up and funding additional currency pockets, according to Merafe.

The feature also includes what Investec calls “Intelligent Routing™” technology that ensures transactions are processed from the appropriate currency pocket without manual intervention.

“When you’re in France and swipe your card to buy a baguette, money will be used from the euro pocket, for example. And if, for whatever reason, there are no funds in a currency pocket available, it will take money from the rand pocket.”

Typically, when people swipe a South African card overseas there will be a cross-currency fee that can range between 2% and 3% on any transaction.

“But because the currency pockets are prefunded, clients will not incur these transaction fees,” says Merafe.

Clients can also switch off specific currency pockets to preserve funds for future use.

“Clients could, for example, put money in their dollar pocket. If they decide to preserve the dollars in that pocket, they can switch off the dollar pocket on the app, and the system will take money from the rand pocket.”

Read: Investec sees welcome rise in lending activity post-election [Nov 2024]

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