British entrepreneur Richard Bransonâ€™s latest venture into South Africa, Virgin Money said on Wednesday it has already issued over 50,000 credit-cards in the six weeks since its launch.
Virgin Money is a joint venture between UKâ€™s Virgin Group and Absa - South Africaâ€™s largest commercial and private bank. The company has also approved more than 20,000 Car Cards used to pay for petrol and toll roads, according to a statement. Virgin Money has pledged to take on local banks who overcharge its clients.
Virgin Money has brought real competition to a fat-cat South African credit card market and stimulated a permanent shift towards lower pricing, said John Maxwell, the managing director of Virgin Money South Africa in a statement.
He added that the astounding response to the launch of the new credit is proof that South Africans are looking for a better deal from their financial institutions. The Virgin Money credit card is the first in the country to offer no annual fees, no loyalty fees, a flat interest rate of 5 percent, and an interest rate of 0 percent for the first three months of any purchase. The company also offers a variable rate of 15.75 percent thereafter.
â€œSimply put, we're offering a financial product that is superior to anything else in the South African market,â€ Maxwell added.
Many consumer groups have already accused the countryâ€™s major banks for charging fees for services that are usually offered freely in other countries, which has opened up the market for competition.