Johannesburg — FIRST National Bank (FNB), which derives about 50% of its revenue from noninterest transactions, will from July 1 adopt a new fee structure expected to increase its fee income 7% over a year.

FNB's pricing executive, James Fowler, said the bank had tailored fee increases so that primarily customer transactions over the branch counter, cheque fees and avoidable penalty fees would rise more or less in line with inflation.

Electronic banking platforms, such as for cellphone, telephone or internet banking, would remain free. Some ATM fees would either be reduced or stay the same.

Fowler said the increases were due to staff costs driven up by pay rises, the need to keep employees in a competitive jobs market and higher cash-handling costs -- a factor affected by rising security costs.

Electronic banking channels cost the bank less to operate and handled a higher volume than branches.

"Because we want to promote efficient usage of cheaper banking channels, we have kept several day-to-day electronic banking transactions free," he said.

The bank will also launch a new service on July 1, enabling Smart Account holders to conduct an unlimited number of transactions for R59,99 a month. This will include a death benefit worth R10000. The average cheque account fee in the industry is about R150 a month.

Fowler said he believed the bank offered among the most affordable banking prices in SA.

Mzansi account holders' fees would stay at about R17 a month.