Investec will launch its Clarity investing platform to the public, promising easy and affordable access to financial markets. It will compete head-on with EasyEquities.
Clarity was previously only available to Investec’s private banking clients. However, it will now be launched publicly as a standalone trading platform for anyone to use.
The bank had been hinting at a public launch of Clarity over the past few months, with prospective investors able to register for alerts as to when non-Investec clients could access the platform.
Investec said the platform will provide South African investors access to local and international shares, foreign currencies, and savings products.
Investec said that launching Clarity to the public aims to make investing more accessible to South Africans and is part of the bank’s new growth strategy.
“Clarity puts the independent Investor squarely in the driving seat, allowing you to experience the freedom of investing by yourself,” Investec said.
“Because Clarity is powered by Investec, one of the world’s most trusted and respected financial institutions, you can trade globally with confidence and the assurance that you are not alone.”
In its current form, Clarity has no admin fees, zero commission, and offers users competitive fees. However, it is unclear whether this will remain the case with a public launch.
Clarity would mark Investec’s first foray into mass-market investing, competing with the country’s largest banks and EasyEquities.
Investec has previously opened its Wealth and Investment Online platform to clients outside its private banking. However, this is only for high-end clients with a minimum account value of R1 million.
The public launch of Clarity comes amid controversy surrounding EasyEquities’s introduction of a “platform fee” as a mandatory Thrive subscription.
EasyEquities surprised users by making its Thrive loyalty program mandatory and charging users under level 3 a R25 per month fee.
EasyEquities said it had built Thrive to drive good investment behaviour. It rewards Thrive subscribers with the ability to earn zero brokerage fees.
What was once a voluntary rewards program is now mandatory for all EasyEquities subscribers.
“We are launching an enhanced Thrive programme and implementing a new cost, the Thrive R25 monthly fee,” it explained.
“The Thrive Fee will be deducted from your EasyEquities account, which has a Free Cash balance greater than R25 on the first of the next calendar month.”
Well-known investor Karin Richards described EasyEquities’ new R25 per month Thrive fee as disingenuous. “I would hate to be treated like a child in this manner,” she said.
“The EasyEquities spin is breathtaking in its audacity. ‘It’s not a fee, it’s a favour’ – that just blows me away,” she said.
Many people argue that it is essentially a platform fee masqueraded as a loyalty programme that costs R25 per month.
Richards and others advised EasyEquities to stop mincing its words and announce that it will start charging a platform fee to bolster revenue.
Koshiek Karan argued the message, “It now costs R25 per month to use your service”, is far more palatable than “Be a good boy, get a certificate, and save money”.
Another criticism is that the new R25 monthly flat fee disproportionately hurts smaller investors and poorer South Africans.
Daily Investor showed that the R25 per month fee could change the return on a R5,000 investment over 10 years from a R3,971 profit to a R226 loss.