Johannesburg - Flamboyant UK businessman Sir Richard Branson, on Monday launched the Virgin
Money credit card, predicting that it would lead to the biggest shake-up ever in the South 
African credit card market. Branson, who launched the card with a record breaking stunt, 
vowed to break what he called the country's "banking beast" - charging that South Africans 
were being "ripped off" to the tune of R1.5bn in high banking charges. 

"I plan to break through this wall," he asserted, adding: "I'm afraid the industry down here 
doesn't treat their clients very well." 

He said that South African consumers had long been made to feel grateful just to be offered a 
credit card by their bank and it was high time customers were given a better deal. 

"Ripping off" clients

"South African banks are ripping off credit cardholders to the tune of R1.5bn a year through 
inexplicably high charges and complex fee structures," said Branson. 

"The Virgin Money Credit Card now represents the best value in the market and it signals the 
beginning of the end of the great South African banking rip-off." 

"It seems absurd to me that South African banks are still charging customers annual fees just to 
carry around their particular brand of credit card. 

"That the big established banks have somehow managed to cling onto over 66% of the credit card 
market, after years of giving customers such poor value and service, is even more extraordinary. 

"Lucky" to be customer

"For too long, the attitude of South African banks has been that you are lucky to be their 
customer. The ultimate expression of this approach is the frankly ludicrous practice of charging 
fees for cardholders to be loyal to them or to 'reward' them!" 

The Virgin Money credit card - a 50:50 joint venture with South Africa's Absa Bank (ASA) - is the 
first in South Africa to combine no annual fees, no loyalty fees, and an interest rate of 0% for 
the first three months with a competitive interest rate from then onwards of 15.75%. 

The card is also the first to offer a flat 5% interest rate on any positive balance - no matter 
how big or small. 

John Maxwell, managing director at Virgin Money South Africa, explained that the new credit card 
offering was designed to provide absolute transparency in fees. 

Only eight charges

"The average South African credit card has up to 25 different charges - Virgin Money has eight, 
and we've made it even simpler - we have only five fee numbers," he said. 

"We have no Platinum, Gold or Silver cards. Everyone gets our best rates, our lowest charges, no 
hidden nasties and the best service - no matter what their credit limit." 

Virgin Money is expecting to spend in the region of R40m to R50m in their first year in South 
Africa, Maxwell said. 

He disclosed that the company was also planning to roll out a mortgage product by the end of the 
year. The company was also looking at other financial service offerings. 

A "bit of a dip"

Branson said the South African economy was obviously going through "a bit of a dip at the moment". 
"But one way of bringing a country out of a dip is by bringing competition into the country." 

In his usual inimitable style, Branson launched new credit card in South Africa with a daredevil 
stunt - ziplining 450 metres (equivalent to a height of 25 storeys) from the roof of the Sandton 
Sun Hotel into the parking lot of Virgin Money's headquarters in the plush Johannesburg northern 
suburb of Sandton to establish a new South African record for the longest and steepest "foofie" slide. 

"I'm going to save Africans millions. So if it means my stomach churning a little bit before I jump 
off a building, then so be it," Branson quipped. 

Source: http://www.fin24.co.za/articles/default/display_article.asp?Nav=ns&ArticleID=1518-24_19581911